With consistent 20-30% YoY growth, they'll hit eight-figures
Third-generation Master Tea Blender Emeric Harney joins us to discuss the online success of their 37-year-old family tea business, Harney & Sons. Harney & Sons is a tea company that is committed to "making quality tea an everyday luxury."
Key Takeaways:
The Unofficial Shopify Podcast
11/10/2020
Emeric Harney: Okay.
Kurt Elster: So, wait. Hold on. You’re drinking coffee, not tea?
Emeric Harney: I am, and to be… defend myself, my grandfather always did start his day with a cup of Japanese green tea, but he did drink a significant amount of coffee and I do both of those things, so I am an apple not far from the tree in some regards.
Kurt Elster: In your grand tea community experience, this is the cold open. Is there a war between tea and coffee drinkers and should I be preparing?
Emeric Harney: There is no war. I think that there’s been this shift… I mean, I would not say I’m an aficionado of coffee, but there’s clearly been this shift in how people are looking at like originally people were drinking diner coffee, and Folgers Coffee, and then we got into a little bit more specific coffee with like Starbucks, and then all of a sudden you get into these very direct from the growers, or these specialty coffees, and I think that that’s something that’s been in tea for a while. So, like tea’s been waiting for coffee to catch up in a sense. But-
Kurt Elster: Oh, shots fired.
Emeric Harney: The consumption of tea is far less, at least in the United States. You know, worldwide it’s number two, but coffee, I think it just had this Americana association that tea never had, especially since… We used to drink a ton of green tea, and then World War II happened and it’s like, “Sorry, no more Japanese green tea.” For obvious reasons. And I don’t believe there’s a war, but we did actually just write a really fun blog post series about tea and war, but that was more about the Revolution, the Boston Tea Party, and the Opium Wars.
Kurt Elster: I will have to send that to my wife, who is quite the U.S. history buff. All right, on today’s episode of The Unofficial Shopify Podcast, we’re talking to a man who knows more about tea and has probably drank more tea than anyone else I know, maybe even you know. Talking to Emeric Harney of Harney and Sons Fine Teas.
Emeric Harney: And The Hemp Division, don’t forget-
Kurt Elster: What was that?
Emeric Harney: And The Hemp Division.
Kurt Elster: Oh, and The Hemp Division. You’re right. Yeah, you’ve got several brands under your belt. But Harney Tea is a fantastic tea, has a ton of variety, it’s been around a while. You can get it in Target. I’ve seen it in all kinds of coffee shops. I drink it. I love it. And I greatly enjoy working with Harney on their website. They’re a very successful Shopify Plus site. And Mr. Emeric Harney is joining me. So, Harney and Sons Tea, Fine Tea Company, and Emeric Harney, any relation there?
Emeric Harney: I think I’m a cousin. No, I’m actually third generation of the tea, not magistrate, because that would be the wrong word, but-
Kurt Elster: Magistrate.
Emeric Harney: But of the tea family. My grandfather started the company in 1983. My father joined the company in 1988. He had been working in Chicago at a hotel, which is where I was born, and then my uncle joined in the mid nineties, my mom, my brother, myself, so I started really working for the tea company as a kid, but let’s say as an adult when I was 23 I opened up our shop in Manhattan.
The origins of the tea company is certainly… It’s a bit longer than I would say most Shopify website stories might be. My grandfather had gone to hospitality school and was managing inns throughout New England, staying a few years here and then moving on, and he had ended up in Salisbury, Connecticut, which was where we were originally headquartered in the mid sixties, and he had run an inn there, and it was there that he had met this gentleman, Stanley Mason, and Stanley Mason had worked previously as a broker in New York City, buying tea and just for other tea companies, purchasing from overseas, and he himself was three generations a tea man. His father had been a tea broker and before that his grandfather had actually been a grocery merchant selling tea, so maybe the least, the lowest on the totem pole. But still very important all the same.
And Stanley had started a small tea company in Salisbury, Connecticut, and really started to peddle this idea to my grandfather of quality tea. You know, in the sixties, and even fifties, sixties, seventies, people were really looking at instant coffee, instant tea, how can we enjoy something as simply, as most affordable as possible, as simply as possible, and this idea of specialty coffee, specialty food, specialty tea, none of it really was that successful at the time. But my grandfather, with his hospitality background, and working at these different inns, really took pride in providing an amazing French American Chinese cuisine. He had hired this man from China to do all this authentic Chinese cooking in this small, small town in Connecticut and was obviously putting a lot of emphasis on the food.
He was grinding coffee fresh for service, so that aroma was wafting and making customers excited to have a cup of coffee, so Stanley Mason walked in off the street, which is not a very big street in Salisbury. It’s a town of 2,000 people. At that time, probably much less.
Kurt Elster: Whoa.
Emeric Harney: And-
Kurt Elster: That’s like a village. That’s a hut.
Emeric Harney: It’s small. And so, he encouraged my grandfather to take pride in his tea service in the same way that he was taking pride and emphasis on quality coffee, quality food, and so throughout the sixties and seventies, my grandfather worked with Stanley. Eventually Stanley went into full retirement and there was some mixing and matching of he acquired the company, but wanted to start his own company, and so in 1983 Harney and Sons, without any sons involved, was born. But-
Kurt Elster: So, was it called Harney and Sons in 1983?
Emeric Harney: Yes.
Kurt Elster: But it was just him?
Emeric Harney: It was just him. And you know, it has a nice ring to it, like Harney Fine Teas isn’t as nice, and-
Kurt Elster: I agree with you.
Emeric Harney: Who’s to say parents shouldn’t guilt their children into working with them?
Kurt Elster: Yeah, like as soon as he named it Harney and Sons, but it was just him, there’s definitely an implication there. Luckily, it’s an extremely successful business.
Emeric Harney: It honestly, you know, we started… So, when he was starting to take over Stanley’s business, which was Sarum Tea, back in the late seventies, early eighties, there was only about six varieties of tea and he was selling them out of the basement of his house. Well, basement of the inn first, and then eventually the garage outside the house. And I mean, I don’t think ever in my grandfather’s wildest dreams that he would have imagined it being the size that it is, or that it was when he passed, or that it is today, which is… You know, he passed away six years ago, and we’ve come a very long way in six years.
I would say there’s lots of factors, but obviously Shopify is one of the largest factors from the direct-to-consumer side. You know, to go from six flavors to now well over 300 was a huge-
Kurt Elster: Oh my gosh!
Emeric Harney: Yeah. And I’m sure you will pick my brain about it, but each of those different flavors has multiple packaging SKUs and it’s-
Kurt Elster: All right, so if you’ve got 300 varieties of tea, how many SKUs are in the store?
Emeric Harney: I believe… So, most SKUs we sell loose tea only, and so those have like a sample, a four ounce tin and a pound. And then we get to our more popular selling teas that we offer in tea bags and sachets, and ice tea pouches, and so I believe the number is somewhere between like 1,200 and 1,500 SKUs total. Maybe.
Kurt Elster: Wow.
Emeric Harney: Give or take.
Kurt Elster: That’s quite a lot of tea. I have worked on some coffee stores. No one had more than 100 SKUs.
Emeric Harney: It’s a lot to manage. You know, one of the things that we’re working on right now is we’re migrating to an ERP system and it is a journey, to say the least, to make sure that all of the data that we’ve been using for the last 25 years or so that was incomplete, I would say generally speaking, needs to now go into this new ERP system and there are so many steps involved. But in the long run, it’s going to benefit us, because we are also a wholesale business. We do a lot of direct-to-consumer business, which you’re familiar with working on our site, but majority of our business is export and wholesale.
So, we do hotels, we do casinos, not so much right now. Restaurants, also not so much right now. But we also sell to iHerb, we sell to Amazon, we are-
Kurt Elster: Do people private label Harney tea? Is there secret Harney tea out there?
Emeric Harney: We do a lot of private label. I have signed a number of different NDAs, so I can’t tell you whom we package for, but there are a lot of different distributors nationwide that we do-
Kurt Elster: So, I did want to try and paint a picture for people of just how… of what a large and storied institution-
Emeric Harney: Right.
Kurt Elster: … Harney has become over the decades. And you’ve started to in broad strokes fill that in. Can we describe it as an eight-figure business?
Emeric Harney: I think you know, maybe in the next few years you could have said such a statement about us. The pandemic obviously seriously curtailed a lot of our growth. You know, we have managed to pick up Walmart again, which we had worked with Walmart about four or five years ago, and then they dropped us, and now they’ve brought us back, and that’s been amazing for us. We love the simplicity of working with Walmart I should say as… Well, I don’t know if that’s everyone’s experience.
Kurt Elster: Really?
Emeric Harney: But it is our experience. It’s a lot to obviously… I’m not too involved with the day to day of it, but it is a lot to set up, but once you’re set up, we as a brand, we just talked about the fact that we have somewhere between 1,200 and 1,500 SKUs, with Walmart we have like four. So, it is so easy to just make sure those four items are in stock anytime Walmart might want them, and that’s… You know, and it’s great distribution. It’s one of the things, and this is kind of a segue, but not, that my grandfather had always wanted for our company is to make tea an everyday luxury.
And I mean you really can’t get more everyday than going to Walmart and finding a good cup of tea for, I don’t know, I think it’s like $4.99 or $5.99. So, it’s a really great introduction to our brand being in places like Walmart, Amazon, et cetera. But to kind of go back there about the eight-figure business is that 60, 70% of our business was wholesale, and restaurants, casinos, hotels, it’s nothing right now. So, we’ve been very fortunate in the fact that our eCommerce business has been able to fill in a large number. Not all of it, but a large number that we were missing from that. And then Amazon and iHerb, as well, have grown.
Kurt Elster: So, this business really had a tremendous number of income streams, and that’s like it’s wholesale, but wholesale is divided up with… You know, I’ve seen it in independent coffee shops, it’s in huge nationwide chains like Walmart, and I know I’ve seen it in Target. And you’ve got then hotels, and restaurants, and casinos, and then on top of it, it’s direct to consumer and on other online marketplaces, like Amazon. So, you’ve got this system set up where just like you would want a diversified portfolio, you have diversified the income streams in this business where when something terrible like the pandemic occurs, you’re able to weather it.
Emeric Harney: Absolutely. I can’t take credit for it since my purview is retail, both in-store sales, we have our shop in SoHo, and then eCommerce, but my family and the people that have been with us, we have a lot of long-term employees, have really developed this multi-revenue stream where not only are we selling direct to those hotels and those casinos and whatever it may be, we also have a lot of distributors. So, whether it’s a beverage distributor in Manhattan that’s moving our bottled beverages, or it’s something like UNFI, which is picking up all of our tea bags and our sachets, we have a lot of different channels.
I mean, I think we did like a starburst diagram and there’s at least 12 to 15 different channels that we operate under, and so there’s also different pricing levels for all of those, which is something else all together. But it’s definitely allowed us to pivot in this time where we lost a large part of our revenue streams and originally our reaction was very protective.
Kurt Elster: Yes.
Emeric Harney: But we’ve now been able to-
Kurt Elster: It was like… Well, I don’t know how much you want to go into it, but I remember talking with you about it and talking to a lot of people, and it was March, and no one knew what was gonna happen, and we were all scared and handling it in different ways. And I would describe your approach as aggressively defensive.
Emeric Harney: I mean, I think that’s something that as a company, we’re super bootstrapped, and I think that throughout our history, there have been moments where, as my uncle likes to say, we’ve flown really close to the sun. And that’s not a very positive statement. And so, we especially, at least being in the situation that we are with eCommerce, it’s super easy to be aggressively defensive since the majority of our budget goes to top of the funnel, mid funnel, low funnel acquisition conversion stuff. So, we were able to curtail our spending immediately and just protect ourselves in that regard.
But I mean we quickly saw that that was the wrong thing to do and people were seemingly more incentivized than before to either shop direct or to just consider consuming tea and consuming tea at I would say not an alarming rate, because I don’t think you can consume tea at an alarming rate, but in a much… aggressive way.
Kurt Elster: A rapid pace.
Emeric Harney: At a rapid pace. You know.
Kurt Elster: How would you… Well, so what do you think the pandemic’s impact has been on tea? More people are drinking more tea more often?
Emeric Harney: I think a little bit that’s something that’s true. You know, people being at home more, maybe there’s this idea that they can be consuming more tea on a regular basis. I think that there’s also this idea that there are wellness brews, like whether they’re herbal infusions, or a combination of tea and herbs, that can help strengthen your immune system, and I think that people are just looking at what they’re consuming during this pandemic and it’s really easy to say like this warm beverage that tastes great, at least in April and May, and obviously it’s a little bit different in the summer. We focus more on iced tea. We’ve really lucked out in that regard that people have wanted to consume that more.
Kurt Elster: Absolutely. And it’s like that’s nothing you could have predicted. It just happened to be the case. In a time where everyone’s feeling anxious, I don’t necessarily want to be chugging more caffeinated beverages. You talked a lot about the story behind Harney and it’s this decades-long interesting family business. Is that part of the brand story? Is brand story important for you?
Emeric Harney: Brand story is hugely important to us. I think it’s what really… It’s one of the elements, I should say, that really sets us apart from our competitors. We have this tradition. From my grandfather’s perspective, he learned from Stanley Mason, who was three generations a tea man, and my grandfather passed down information to my father and my uncle, and they have passed it down to my brother and myself, and none of our competitors have that, whether you want to look at it as six generations or three generations, have that story to tell. And I think that tea especially is something that is something that you share with somebody, you have that interaction, you can taste it, you smell it, it’s all this sensory experience that you can’t necessarily just get out of a book. You can’t just read about it.
So, being able to share our sourcing stories, our family stories. We think that that is something that makes us very unique and we’ve used it in a lot of different ways. We have our podcast that we use as part of our welcome series and onboarding series for new customers that shares the full origin story about… You know, my grandfather wasn’t around for us when we decided to do it, but we have his wife, my grandmother, and some dear friends that have joined us on the podcast that knew him well from the very beginning. That is something that people really appreciate. We get letters about people that have been with us for 20, 30 years buying our tea, and that’s something that I know for certain that a competitor, I don’t know if you want me to mention them-
Kurt Elster: Nah, don’t give them the credit.
Emeric Harney: Exactly. I don’t need them to have any additional search. But you know, it’s a combination of heritage and tradition as well as education, and that’s something that we also try to put at the forefront with our content, is how to take people that may not be the most knowledgeable about tea and how can we share in a way that we can… How can we share that with them so that they can expand their repertoire, their savviness of tea?
Kurt Elster: So, you have a branded podcast that is both, that shares the brand story and teaches people about tea, and that’s part of a welcome series?
Emeric Harney: Yes.
Kurt Elster: Wow. And like was it a one-off thing you recorded and it’s up there, you set it and forget it? Or is it ongoing? Or you just record it when the mood strikes?
Emeric Harney: It is a set it and forget it. However, we are… We’ve had close to like 20,000 downloads and the ratings are nice, which is great, and people have been asking for a season two. And last year we had started to develop a season two, but then things just got a little crazy.
Kurt Elster: As The Tea Steeps. That’s such a good name.
Emeric Harney: Well, you know, we… I did toy around with a number of different names and for me, As The Tea Steeps was something that… The episodes are somewhere between 15 and 20 minutes long, so it was something that you could put the kettle on, steep the tea while you’re listening, and that was the idea. It was this combination sensory experience. Yeah.
Kurt Elster: And I like the idea. You said tea as a sensory experience. It hadn’t occurred to me, but the moment you said it, it clicked. Because you’re right, tea is very colorful, and it’s very aromatic, and you gotta wait for it to cool. I don’t know. There’s a lot… It’s fun. It’s genuinely… It’s fun to make. I enjoy it. In the summer, I don’t really drink it. In the winter, I get that Hot Cinnamon Spice. Oh my gosh.
Emeric Harney: Yep.
Kurt Elster: Any of the spice teas I’m in on.
Emeric Harney: That is our golden egg, our golden goose, whatever you want to call it.
Kurt Elster: Is the Hot Cinnamon Spice?
Emeric Harney: Yeah.
Kurt Elster: It’s everybody’s perennial favorite?
Emeric Harney: Of our SKUs, which we’ve gone into the number of them, Hot Cinnamon… I don’t know. I mean, I don’t know if this is supposed to be said or not, but I’m like… You can’t deduce anything from it. But Hot Cinnamon Spice makes up I would say close to 10% of our revenue.
Kurt Elster: Whoa! Yeah. With good reason. It’s a genuinely good tea. I was like, “I like tea.” Then you were like, “Look, this is our best. You gotta get this.” And I got it, and sure enough, it is literally the best tea I’ve ever had. I love it. I’m very into a lot of flavor, though.
Emeric Harney: Well, it’s certainly… I think for the… How do I not shame you? The more educated tea drinker, it might be a bit intense. It’s aggressive. I think that’s the theme of today is that it’s aggressive.
Kurt Elster: Right.
Emeric Harney: It really does cover up the tea flavor, and in fact, when my grandfather had-
Kurt Elster: Oh, so if you’re a purist, this is like complete bullshit. This is the Frappuccino of the tea world.
Emeric Harney: No, I wouldn’t even say that. But I will say that when my grandfather had acquired the recipe for this tea, Stanley Mason, his mentor, accused him of prostituting the tea, because it… You can imagine a little 70 or 80-year-old British man accusing my grandfather of prostituting tea. That’s what happened. And it is… I mean, to an extent, it’s also… It’s a blessing and a curse, because obviously it makes up a lot of our revenue, and it introduces a lot of people to our brand. The challenge was that nothing else tastes like it in our lineup, so we have managed to find… We now offer it not only as a black tea, but as a green tea, an herbal, and a decaf, so no matter what your preference of caffeine content or base tea may be, you can enjoy it.
But we’ve also tried to create some equally powerful blends, only succeeding with one, but at least it’s one and it’s not none. And that is Hot Apple Spice.
Kurt Elster: Hot Apple Spice is also very good.
Emeric Harney: So, it’s equally… It’s slightly less powerful and more sweet, less spicy, but I mean Hot Cinnamon Spice is like a piece of Big Red gum, it’s a Red Hot.
Kurt Elster: It’s intense.
Emeric Harney: Yeah. It’s quite intense.
Kurt Elster: I was pleasantly surprised. This thing is like in your face and it has this lovely orange color. I like it. All right, so with 300 varieties of tea and even more products and variants like that in your catalog, what kind of problems do you face with that when you have such a big catalog of products that are all very similar?
Emeric Harney: Especially a challenge in eCommerce to convey what makes them different from each other enough so that you would want to try something new. Especially when we look at single origin teas where we’re talking about a steam Sencha from Japan and we have nine different Senchas, and how do I in a body of text, and imagery, and blog posts, and things like that, how do we convey what makes Ichiban Sencha different from Kagoshima Sencha? There are some basic things to understand about those two different teas. One’s a deep steamed tea from the Shizuoka region and one’s from the island of Kyushu, so there’s those types of differences.
But from an actual tangible what somebody can understand and appreciate from that, that’s a little bit harder. I also find that I run into issues of prior to Launchpad, perhaps, of putting things on sale and forgetting they were on sale.
Kurt Elster: Oh, geez.
Emeric Harney: Because there is such… I mean, there’s not necessarily a super easy way to be like, “Let me filter all the things in Shopify that have a compare at price.” Don’t even get me started on the fact that that’s how they handle this whole thing with sales, but I love Shopify, but I have a lot of thoughts. Anyways, there’s not an easy way to be like, “Oh, what have I put on sale that I forgot to take off sale?” I mean, maybe people just are more organized than me, but that’s something that definitely is a challenge.
And beyond that, I think the other challenge that I run into is product discovery, and how do we not only… Obviously, we have to educate people about the differences between the two, but in such a large product catalog, how do you direct somebody as a first-time consumer maybe purchasing Hot Cinnamon Spice, how do we direct them to the next thing that they will still like and not be disappointed by? And that is something that through a variety of apps, which we have many, we have tried to do. I think we’ve also discovered a lot of automation through email marketing that helps us guide people through that customer journey, and we’re trying to do more on-site product discovery. Whether it’s quizzes, or whether it’s watching human… or not human behavior. Watching customer behavior and serving them content through popups, through exit intent, through email, that are related to their purchasing and browsing behavior.
So, I think we’re getting there. On site personalization and journey optimization.
Kurt Elster: Yeah. When I land on the homepage, the featured product collection, it’s a slider and it says, “Recommendations for you.” Is that personalized to me?
Emeric Harney: It is now personalized to you.
Kurt Elster: Cool. How’d you do that?
Emeric Harney: I think it’d be really fun to say, “Kurt,” in that situation. Because I’m sure we actually have your name somewhere.
Kurt Elster: Yeah, you’re using Klaviyo. Klaviyo’s a CRM. And, or if I was logged in, yeah. Yes. Actually, remind me of that after the podcast. That’s a thing we could try to do.
Emeric Harney: Well, I don’t even think that we would… I mean, I think through Shopify you could do it, but we’re actually using Nosto, and Nosto syncs in with Klaviyo.
Kurt Elster: Nosto for personalization is so powerful. It could… If anything could do it, I bet Nosto can.
Emeric Harney: I’m sure Nosto can do it, and they communicate really well with Klaviyo, so I believe that there wouldn’t be any reason why if you’re a known customer that it couldn’t actually say your name in the same way that I believe Amazon does that. Recommendations for you, Emeric.
Kurt Elster: Oh, that Nosto on site personalization thing is really cool. Are there any other nifty apps or widget the site’s running that you’re proud of?
Emeric Harney: Let me just pull up the really long list. We have 51 apps, for anybody who’s curious.
Kurt Elster: Oh! Oh no! Oh, wrong button.
Emeric Harney: Eww!
Kurt Elster: 51 apps!
Emeric Harney: I don’t believe this first one on this list is worth counting and I’m sure there’s many others, so we’ve got… I mean, we won’t go through the whole list, but the first one is 3D Warehouse, and that was something that when we were using Tapcart, which was our mobile app thing that we were using at the time, and Shopify was releasing this idea of using 3D renders of your products, I went down this road of having a large number of our top-selling products created in AR so that people could put them in their tea cabinet for some reason.
Kurt Elster: Oh yeah. You did do that. You had 3D models of this stuff.
Emeric Harney: And then Shopify and Apple decided to change, and I did not want to pay more money than I originally paid to have everything converted since it was just a conversion, and so I just dropped the whole product. And now it’s somehow that 3D Warehouse is in there. But you know, we use… I think some really powerful apps that we use are push notifications. We… Do you want me to say the apps’ names that I like?
Kurt Elster: Of course. Yeah, rattle off. Just pick three. What are your three favorites? Give them the free plugs.
Emeric Harney: So, you know, I think that I’ll start with the one that I liked, which was Aimtell. Using push notifications as an added layer of connecting with our customers is nice. I am eager for the day that I have a more centralized communication between my push notifications and all my other areas of connecting with my customers. Maybe… I believe Klaviyo has said that that is something in their pipeline, whereby you can choose whether you want to send somebody an email, or a push notification, or an SMS, and for me I don’t really get behind the SMS thing.
Kurt Elster: Oh, really?
Emeric Harney: I find companies texting me obnoxious. The only company that texts me on a regular basis that I don’t mind is the local marijuana dispensary.
Kurt Elster: Right there with you, buddy.
Emeric Harney: When they have something new, I’m kind of curious. But more often than not, I just… Especially from a marketing perspective, it’s hard to justify that additional cost associated with SMS.
Kurt Elster: Right.
Emeric Harney: I don’t find that there’s platforms out there that really are able to identify, net new traffic, and focus on the fact that okay, we as a website have 55% of our traffic is mobile, but how much of that traffic is net new, and I’d like… I’d pay money to market to those people, but nobody’s really great. Because in the end when I’ve done these experiments with SMS, I find that the people using my SMS are the people that I’m already emailing. So, I’m just paying twice to market to the same people and I’m giving them a new discount earlier than I really want to.
Kurt Elster: Okay.
Emeric Harney: At this point, I mean, I think that maybe with Klaviyo there’s a way to get that a little bit more aligned, where they know more data, so they would be able to choose how you’re gonna send us-
Kurt Elster: Yeah. If you have everything, like both the SMS and the email living in one CRM with Klaviyo, I’m sure you could sort that out, you could segment it or use a flow filter on it to stop that. My experience with SMS has been positive, so I was surprised by that.
Emeric Harney: I just also… I look at our audience and our audience is a little bit… It’s a little less young, and so we… I can’t remember the term that Klaviyo talks about it, but 48% of our revenue comes from email, so it’s not like we’re in a position where email is not working. So, the ROI on Klaviyo is just massive for us.
Kurt Elster: With a store that has 51 apps, what’s it like trying to, like day to day, running a store with 51 apps. Are you like, “Man, everything’s perfect and all this stuff is handled for me in my super powerful widget-enabled store.” Or is it just like a game of whack a mole, eCommerce whack a mole every day?
Emeric Harney: I would say it’s generally whack a mole sometimes. You know, for instance we just switched to a new product filter search thing and there’s just… You know, there’s just layers and apps that when you have subscription products, and you have one-time purchase products, and you’ve got a loyalty program, and you’ve got the instant add to cart situation and you want to add to cart from collection, and you’ve got product SKUs and whether it’s $3 or $20, and people feel like you’ve bait and switched them. Which is what we dealt with yesterday.
Kurt Elster: Oh, right. Yeah, because just… and you hadn’t. It was just the way… They didn’t like the way prices were displayed in the collection.
Emeric Harney: Right. And in the end, when you add something to your cart, it’s still telling you the actual price, but we dealt with this situation where a large number of customers started engaging with us on Shopify chat and yelling at my sweet lady that sits behind that computer, and you know, it oftentimes… There’s a lot of things that create conflict when you have so many different experiences, and apps, and we’ve got the Cookiebot GDPR, and we’ve got… We had Yieldify, which was that exit intent thing that we were doing, and now Nosto, and Printify on demand, and now we’ve got… We’re doing a lot of affiliate marketing, so there’s that to worry about. There’s just all these ways that these things interact that is generally not seamless, and Shopify-
Kurt Elster: Very much it turns into a Rube Goldberg machine where at the end, the goal is a sale. But along the way, as you add more and more pieces, there’s just more to go wrong.
Emeric Harney: Absolutely. And you’ve been… I think we’ve been working together I think it’s been three years. I think it’s been three years. I think when we first redesigned the website from whatever basic Shopify block theme, we were on Block Shop or something, to Out of the Sandbox, I think at that point we had 37 apps. So, I did manage to delete two while we were talking, so now I’m down to 49.
Kurt Elster: Congratulations!
Emeric Harney: But I mean some of them are really marginal, like one is like customer fields, where it just allows customers to edit their email address. You know, like that’s just something that’s super small and not that important, so that one doesn’t have a lot of whack a mole situations where something went wrong. But there’s obviously some larger ones that cause a lot of headaches. But there’s also things in this app lineup that like… I created a custom app with a developer to allow people to submit where they’ve had Harney and Sons, and I paid a significant amount of money for that app, and it just never… It’s sitting here in my apps, but it never… It doesn’t do anything. Never came to fruition.
So, there’s some stuff here that’s nothing.
Kurt Elster: If you could, so the best part about Shopify for many people is the app store. The worst part about Shopify is also the app store. If you could wave a magic wand and just add any one feature to Shopify, what would it be? And it’s not an app, like let’s say Tobi Lutke, founder of Shopify, is going to call you up on the phone and tell you in his beautiful German accent, “Pick one feature and I’m gonna add it for you.” What is it?
Emeric Harney: Well, I just, I think that the reporting features are severely limiting, and I think that when you look at the different areas in which you can pull data from, the one that at least pulls in the most amount of information is Google Analytics, but it’s entirely inaccurate, which is the most annoying thing. And we’ve used Kissmetrics, we’ve used Glew.io, it’s just… Shopify has all the data. They have all the referral information. They have all the source information. I just wish that we could manipulate it appropriately. And I think that would be the biggest feature for me, just because as a marketer if I don’t have accurate data, how am I supposed to know what I’m gonna do to move forward?
So, you know, I can pull the stuff from GA, but when you look at GA, revenue’s off. Actual quantities of products sold is off. You look at whether it’s a last click attribution or whether it’s a seven day window. I mean, there’s still just data that’s not accurate.
Kurt Elster: I agree with you. I like to use Shopify. Shopify’s data and analytics as my single source of truth, but sometimes you get in a situation where you’re limited, and for that I’ll often be like, “Okay, can I pull, make this work in Google Analytics?” But ah, what if it’s not quite right? I got an app recommendation for you that might save your bacon. Better Reports for Shopify. The app’s name is literally Better Reports. It’s really powerful.
Emeric Harney: Well, so we have used Better Reports, which has actually now been updated to Report Pundit. However-
Kurt Elster: Oh, it’s got a different name now?
Emeric Harney: They updated-
Kurt Elster: Or you switched?
Emeric Harney: No, no. They created a new one and they said, “Please don’t use Better Reports anymore, use Report Pundit.” And Report Pundit is powerful, but it still has limitations in the sense that it actually doesn’t backdate your data. So, if I want to look at… I mean, at this point anything prior to this year is garbage in a sense, because this year has been so transformative as far as direct-to-consumer marketing and commerce goes… For most brands, I should say. I don’t know. I can’t speak for all brands. But for us specifically, I mean we were looking at April and July, which are usually small troughs in our revenue, and they were not equal to but just almost, like 10% shy of December numbers.
And so, of course anything prior to this year was… Why look at previous years? Now we’re just looking at previous period. And Report Pundit, when we installed it in June, there was no data for April or May, which was really important for us. So, it has limitations. I think that Shopify would really benefit and I’m sure it’s probably in the pipeline, and my MSM says, “Yeah, sure. Maybe sometime.” I do actually… My MSM has grown on me and I won’t say his name because for a while there-
Kurt Elster: Merchant success manager, MSM.
Emeric Harney: Yep. He irritated the crap out of me.
Kurt Elster: No!
Emeric Harney: But I find that… You know what I think it is, is that they are so few as a group that they have to manage a large number of accounts and they can’t make any promises because something may be in the pipeline but they can’t say, “Oh yeah, it’ll be ready by Q4.” I mean, that’s something that as much as I love Klaviyo, they were like, “Yeah, push notifications. Q3, Q4, 2019.” Wrong. Didn’t happen.
Kurt Elster: It’s true. I did not know that was in the pipeline. You’re actually… I’m hearing it from you.
Emeric Harney: Well, but to be completely… Because for me, it was one of the reasons I thought about leaving Klaviyo and looking at something like… What did I look at? Emarsys. We looked at Zaius, which that was a travesty. As you defended my honor on Twitter. Yeah. And what was another one that we looked at? I can’t remember. Anyways, those all had push notifications and Klaviyo was like, “No, no, stay. We’ll get it for you.” Unfortunately, it’s not happened. I’ve lived without.
Kurt Elster: As long as we’re… I want to go back to the topic of themes, the theme itself. Tell me about your page speed experience.
Emeric Harney: So, I get weekly emails from my father, who is my boss, and he loves to get… He pays for Pingdom, which is a site speed tool, and he loves to send me, “Oh, we’re doing good this week.” And then all of a sudden something will change. “Oh, what the hell happened?” And so, page speed is obviously something that is super important to us as eCommerce merchants, but it’s such a bizarre, like there’s so little that we can actually control, and oftentimes anything that you can do might benefit your testing ability, but it doesn’t actually benefit your site, which is something that we run into. We’ve done a number of different speed optimizations, since apparently Ethercycle does not offer those. We had to look elsewhere. And-
Kurt Elster: I’m not disagreeing. It’s just there was some sass on that.
Emeric Harney: But we had used an individual or organization, whatever, to do a number of different speed optimizations, and they were able to provide tangible results of, “Hey, we’ve increased your page speed, or decreased your page speed, from 2.5 to 1.8.” We were able to see the work that was done and the impact that it had, but then lo and behold, once we stopped worrying about page speed because we were beyond 4th quarter, and then all of a sudden we just started seeing things breaking and falling apart, it turned out it was because of said speed optimizations.
So, it’s a really frustrating thing, because I’m pretty sure Google says I have a D on my mobile speed and desktop speed, but I think-
Kurt Elster: I’m running it through Google PageSpeed Insights tool right now so we can see. And yeah, you’re right. We had an experience. Oh, boy. We had an experience… I just got the PageSpeed score back. It’s grim. On mobile, you got a 10, which that’s four points better than Gymshark and they’re valued at a billion, so… Nailed it?
Emeric Harney: 10 out of 100?
Kurt Elster: Yeah. On desktop you do a little better with 30 out of 100. And honestly, like most Shopify themes that we work on, a lot of the section themes, the Out of the Sandbox stuff, it seems like the typical rating I see is 22 or 23. Really, that tends to be where it is.
Emeric Harney: I think… You know, a lot of it is limited to how… Well, one, we use a lot of apps, so that’s one strike against us of many.
Kurt Elster: Yeah. You can’t control… You largely cannot control how the app is implemented on the site, and that creates… That really dings your PageSpeed score.
Emeric Harney: Absolutely. I mean, you talk to these different apps and like, “I don’t know what you’re talking about, it’s loaded at the same time as the rest of the page, so it’s not my fault.” But then you also have to deal with the fact that you know, in an effort to optimize for speeds, Shopify uses the CDN, and that oftentimes is one of the largest issues on the site. Obviously, JavaScript does, I think in our case make up a large part of the page speed issues, but there are just limitations within Shopify itself that I don’t think that they could do all that much to make it better because of how many other great things that they’ve done with their framework, but I am eager for this next step they have kind of hinted about at their conference about how mobile speed is supposed to be a little bit better. I don’t know if it was a feature that I’m supposed to request or something, but they had talked about that and I’m eager for that to come in.
Kurt Elster: Well, they implemented… I think the one that made a really big impact was your images are automatically served in a new format that Google loves, called WebP, and it’s very efficient and performant and good. But running your site, I think my issue with PageSpeed Score is it’s not a particularly good metric for is a site slow or fast, because Harney, the homepage, the whole homepage, cold load, is 3 megs. That’s not a big website at all. And the load time, it’s gonna load in three seconds. Okay, that’s fabulous. I mean, that’s very quick. But then you’ve got-
Emeric Harney: But according to Google-
Kurt Elster: Google goes, “What? 10 out of 100! That’s an F minus, minus, minus.” Like you almost got to no points. You would think a website that gets a score of 10 out of 100 or 30 out of 100, that it’s like, “Well, it took a minute and a half to load.” Which I’ve seen. We have done some creative things with Liquid that brook some loops and we had… I did work on a site where we were loading in 30 to 60 seconds. That was grim. And we fixed it, but that’s the kind of experience one would expect when you see a PageSpeed score that bad.
My issue is the PageSpeed score doesn’t seem to have a basis in the actual, functional, this is the real life load time.
Emeric Harney: No.
Kurt Elster: And then to optimize for it, to your point, you end up essentially… A lot of the optimizations are playing to the rules, like you are working to get the test score, and you gotta get aggressive with it, and then down the road other stuff starts breaking. Especially when like, “All right, well, we concatenated all of our JavaScript together and minified it. Ah, crap.” It created issues for us in our… the experience we had with your site.
Emeric Harney: Yeah. Well, because we were trying to lazy load images, or not load them right away, and then they were not loading the way I wanted them to and all these different things. But I mean, you know, two years ago, three years ago, our score was like a 76 and we were loading in 1.5 seconds.
Kurt Elster: Whoa! That’s quick.
Emeric Harney: Yeah, I mean but you and I were working on the same site, essentially, so like-
Kurt Elster: It’s the same theme. Yeah, it has not changed.
Emeric Harney: The only thing that changes was how Google counts this, and you know, we have I would say an effectively low bounce rate for the amount of sessions we get, and we also have a fairly high blended across device conversion rate, so-
Kurt Elster: I was gonna say, you also have a tremendously successful online store.
Emeric Harney: Right, so you can only take it… I mean, what’s really great in my experience is when my Google reps are like, “Oh, but if you optimized your PageSpeed you could be getting this much, so you should also spend this much more money advertising.” I’m like, okay, there’s a lot of things there that don’t really make sense, but anyway. You know… You can’t take it to heart.
Kurt Elster: Yeah, I think it’s… PageSpeed’s just a scapegoat. I hate it.
Emeric Harney: Yeah. You can’t take it to heart.
Kurt Elster: Okay. We have gone… This has gone long. We gotta start wrapping this up. You said your dad is your boss. What’s it like working in a family business? Especially one that has achieved this level of success, and fame, and global spread?
Emeric Harney: I think it’s honestly… It’s much more good than bad working for your family. There obviously are moments where family politics come into play, but more often than not we still operate as a highly functioning business and what’s really great about actually working for my dad is that he and I have a great relationship, and he not just lets me run loose with ideas and content and things like that, but is cautiously supportive. And-
Kurt Elster: Okay.
Emeric Harney: And I think that’s really great. I do think that there are obviously some issues as far as maybe family politics are concerned where I want to push the envelope and for a long time, that was not Harney and Sons’ MO. You know.
Kurt Elster: When you say push the envelope, what do you mean?
Emeric Harney: I mean like incorporating a drag queen into one of our pieces of content, or raising our hands to be part of informed capitalism, and while we have always been an equal opportunity employer, did we necessarily put out all of that information? No. But I think, and I’ve had to cautiously guide them into making some of these more outspoken decisions. Right now, we are in the process of filming our next brand video and I actually didn’t have any pushback on this, but we wanted to make sure that we had a variety of same sex and heterosexual cast in the spot, and we wanted to make sure that we had a wide diversity of people, because it is important for us in our message of tea as an everyday affordable luxury, that tea time is anytime, that anybody can be enjoying tea, that we are as inclusive to everybody.
And like I said, this didn’t have… This wasn’t a challenge. I think in the past, it was more like a drag queen or tattoos was something that was a little taboo within the company, and that was a challenge, but-
Kurt Elster: The corporate culture, the family culture was conservative or just tea… They were risk averse? Or-
Emeric Harney: Risk averse. 100%.
Kurt Elster: Tea just has a… Okay, so they’re like, “Look, we don’t want to ruffle any feathers.”
Emeric Harney: Yeah. It’s definitely it was that statement and I think that some companies might be able to get by with that, but I don’t think we can, and I don’t want to either, and I think that’s been something that has been great to have. Like if I was just some other marketer working for the tea company, I’ve seen people in my position at this company have all of these issues because the family didn’t want to do this, or do that, whether it was as simple as… I mean, we didn’t even have a digital ad budget until I joined the company. Well, until I joined the company in my current position.
You know, like that’s obviously a completely different conversation about rather than developing a piece of content, but there is this benefit of I can push the envelope more so within my family and our corporate culture than any other marketer that we’ve ever had, and we’ve had a handful of very talented marketers in the past, but you know, it certainly… I’m a tenacious individual and being the son allows me to be more tenacious than I think somebody else in my position could be.
Kurt Elster: Well, I’m glad you stuck to your guns and pushed for it, because the end result was really cool, and like the video with the drag queen that you’re talking about is so good, and so neat. I love it. Is that the featured hero video on the homepage right now?
Emeric Harney: The featured hero image is actually about to change, so when we’re talking right now, we actually had-
Kurt Elster: Oh, okay.
Emeric Harney: Yeah. We had a summer ice tea spot that we had done and that was great, and so we’re working with that same agency on a fall flavors video, but that’s not even… We’re actually filming two videos right now at the same time, so we’re focusing on things like Pumpkin Spice, Hot Apple Spice, and Cranberry Autumn, as far as a flavors video for the fall, and then at the same time, we’re working on a brand video that will release a little before, like somewhere between fall and Christmas, and that is… The theme of it is teatime is anytime, and so we’re actually creating this story about the different times of day that people might be enjoying tea.
And originally, this concept was inspired by… There’s a Delta video where it’s all of these different people that are getting up and getting ready to go on their Delta flight, and it’s got the Snow White song, “Heigh-ho, heigh-ho, we’re off to work we go.” And that really inspired me to take this message of what my grandfather was talking about, teatime is anytime, and showing the different times of day.
Because some people might think of only afternoon tea, some people might only think of tea as something that you might consume when you’re not feeling well, like a chamomile with honey, and I just really wanted to encompass all of these different ideas of young, old, couples, individuals, of people that could be enjoying tea. And so, we… I think we’ve got eight vignettes that we’re filming and right now they’re filming a couple in Brooklyn. And obviously navigating filming during a pandemic has been challenging in its own right.
Kurt Elster: Yeah, but you’re creative. So, when you create all this video content, and you’re hiring a video production company, like clearly this is a non-trivial expenditure. Do you use that… Do you just upload it to YouTube and forget it? Is it in ads? Does it get embedded in the website? Does it air on TV? What do we do with this video?
Emeric Harney: Like the last video we made was in 2017 that was a brand video, and we have milked that thing for three years and will continue to after the fact. So, it’s up on YouTube, so we use it as full ad spots of 60 seconds, we use it as bumper ads, we’ll do 6-second ads, we’ll do 30-second clips. It’ll go on Facebook. It will go into… I mean, we actually even use the audio from our very first… the other video in our podcast intro. We’ll use it in our Facebook ads. We do a combination of video and stills to create prospecting campaigns-
Kurt Elster: Cool.
Emeric Harney: And we use the footage for that, as well. And I think what’ll be really great about it, especially since we’re taking this idea of creating these different vignettes of people enjoying tea, not only will we have the blended 60 spot that we can use, we’ll be able to then also take those little individual vignettes and create more tailored, maybe 6 to 30 seconds or something like that, that we can use to target specific demographics, whether it’s we’ve got a really… The first one that we filmed was this group of three toddlers enjoying a super adorable tea party, and am I gonna-
Kurt Elster: Oh, that’s cool.
Emeric Harney: Am I gonna advertise to toddlers? No. But you know-
Kurt Elster: Yeah. Don’t caffeinate my toddler. It’s not a good idea.
Emeric Harney: Well, we do actually have a lot of great caffeine-free options. But you know, I think that that’s something that we’ll be able to use for a long time, which is great.
Kurt Elster: Oh, I’m glad to hear it. Yeah, if you make any great piece of content, get the mileage out of it. Do cutdowns, put it everywhere you can.
Emeric Harney: Oh yeah. I mean, we actually just… We are now in the process expanding our non-purchaser flows as well as first-time purchaser flows, because we have been putting out video content, blog content, for over four years at this point now that we’ve been on Shopify. And it just… We had those, we had flows there to begin with, but they were a little bit transactional and I think that taking this opportunity to take this content that we’ve had for so long and reintroduce it to people that are new customers, or people that don’t know if they want to make a purchase, is super important. So, we’re doing things about like how to brew tea, these are the essential items you need, and we have like four different blog posts about that.
And we’ve got this interview series that we do with folks where we look at influential people and how tea affects or inserts itself into their lives, so we’ve got doctors, we’ve got artists, we’ve got musicians, and we’ve got… What was the other one that I just approved? The science of tea, so we’re using our content in so many different ways, and for instance we just wrapped today on our catalog, which is a print catalog that we mail to 100,000 people, and we’re gonna be able to use stuff that we created exclusively for that print catalog obviously in all of our digital efforts, as well. Being able to use it across the board, I mean if you’re gonna pay anything for content to be made, use it more than once. Absolutely.
Kurt Elster: No, 100%. So, in the future… All right, we’re gonna close on this question. In the future, what’s next for Harney? I see, we mentioned it, we touched on it a little bit, you’re starting… You’ve got another brand called The Hemp Division. You’re starting to get involved with CBD.
Emeric Harney: Yeah. So, I mean CBD is this whole crazy place where there’s all sorts of state and federal legalities that we’re dealing with. We are on our third payment processor in the last seven months and there’s an egregious amount of limitations, primarily because we’re a consumption CBD company versus a topical CBD company. And so, Google and Facebook consistently either deny or flag our ads, which when you’re thinking about starting a new brand, the most impact you can have is just eyes on the site. We know our product is good. We’ve been doing tea. So, making tea and CBD together, we know the product is solid and people like it, but how do we get traffic to the site?
And you know, for a while there, Shopify was limiting us and we weren’t allowed to be on Shopify, so we were on this really clunky other site and migrated over recently, and we had like a 1.3% conversion rate on that old site, and we’re already jumping up to 5% on Shopify, so-
Kurt Elster: Whoa!
Emeric Harney: Yeah. I mean, just the infrastructure about Shopify, you just can’t underestimate the impact it has, especially with its infrastructure of apps. You know, we didn’t have a trusted site icon prior, we didn’t have recommendations prior, so this whole experience now that we’re now on Shopify is just… We’re seeing the company grow so much more, so I think that over the next few years, we’re gonna continue to put out new products for both brands, and I don’t know… If I had a five-year vision of where Harney and Sons is going to be, I mean, maybe we’ll be an eight figure company. Maybe you just prophesized-
Kurt Elster: It’s a self-fulfilling... I think that one’s a self-fulfilling prophecy. I have 100% faith.
Emeric Harney: But I think that, you know, not to toot the Shopify horn, but being able to pivot when need be, whether you’re in a pandemic or you’re in a situation where you’re like, “I need more. I need to spend more money.” I mean, right now, we’ve… I think we’ve nearly doubled our ad budget from last summer. I think that’s a true statement.
Kurt Elster: I believe it.
Emeric Harney: Yeah, and just being… We were on Magento prior to Shopify, and to be in a place where you need to pay this heavy agency retainer to just even update a product was just ridiculous, so Shopify, being able to be nimble, and make changes, put things on sale, have these access to these platforms that can help you sell better… I mean, I just can’t say what it’s done for us. We were plateaued sales wise for almost five years on Magento’s site, and we have consistently and regardless of corona, we’ve consistently seen 20 to 30% annual growth each year that we’ve been on Shopify, and-
Kurt Elster: Whoa.
Emeric Harney: I mean, we’ve put money into it, like don’t get me wrong. You can’t just like, “Oh, I’m gonna go on Shopify.”
Kurt Elster: Set it. Yeah, like, “Oh, it’s Shopify. It’ll just do it for me.” No, you have to have a plan.
Emeric Harney: No, no. No, you have to be putting content out. You have to have great customer service. You know, we… Since corona started in March, we have been seven days behind on shipping, which is awful, but it’s because like obviously business is good, and it wasn’t until just like last week that we finally got back to same day shipping, which was something we did prior. So, you know, you have to have all of the pieces of the puzzle. The operations, the customer service, the great product, the USPs, all of those things are part of the equation, but Shopify certainly is a large part of it, as well. So, I think that we’ll continue to see tremendous growth and we’ll just hopefully become an even larger household name, which I don’t know if my grandfather ever imagined he’d be a household name, but I think at least within the tea community, most people might know who we are. Whether or not-
Kurt Elster: That’s cool. It’s fun.
Emeric Harney: It’s beyond that-
Kurt Elster: You should be proud.
Emeric Harney: Yeah. Thank you.
Kurt Elster: You have done tremendous things in managing and growing the online brand and the retail stores. If someone wanted to learn more about you, where can they go?
Emeric Harney: You can find me on Instagram, @EmericHarney, E-M-E-R-I-C-H-A-R-N-E-Y. I actually don’t post a lot about tea on Instagram. I do-
Kurt Elster: I don’t post about eCommerce on Instagram.
Emeric Harney: I guess that’s true.
Kurt Elster: All like videos of my rabbit. Love that rabbit.
Emeric Harney: That rabbit is like the chillest rabbit I’ve ever seen. Or if you… I guess if you have questions, my email is on our website under the PR media inquiries, or it’s just emeric@harneyteas.com. So, I’m happy to generally entertain questions and share insights that I have about eCommerce, tea, whatever, so if people want to ask questions, I’m there.
Kurt Elster: Cool. Well, I appreciate it. This has been fabulous. Thank you for being here, and sharing this with us, and being so open about the journey. I’m sure it’ll be valuable for people.
Emeric Harney: I hope so.