The Opening The sex toy
industry is around $15 billion Women are over 67% of the customer base, but the current marketplaces have created garish brands that do not appeal to women we have interviewed There are several new, modern, innovative products - WeVibe, Eva, Jimmy Jane - but no great sites to sell them Sex therapists and interviews have confirmed: women do not have a good resource for accurate sex information, and they don’t trust strict product sites when they want to solve a problem. We want to create THE sexual information portal for the modern woman. Current Marketplace Product Innovation
The Team Founded in 2014
by three Stanford graduate students with a mix of backgrounds in e-commerce, art, and design, LoveTap will give couples the resources to identify problem points in their relationship, and the means to enhance their sex life and bring them closer together www.linkedin.com/in/alexismaule https://www.linkedin.com/pub/allison-sommer/12/442/93 *Ecommerce/product marketing experience with Amazon *Experience from Consumer Research, User Behavior, and Brand Marketing classes at D. School *Love working with teams, iterating and coming up with new ideas collaboratively *Sales/advertising and Adwords expertise with Google *After an internship at Birchbox, committed to working in the ecommerce startup space. *Co-founded ALPHA, a shampoo startup (manufactured and distributed shampoos in high- end salons) *Design for Extreme Affordability GSB class - utilized 3D printing and Solidworks www.linkedin.com/in/gdmorgan Wrong! Women as the entry point to couples, Men are not going to seek info, buy products, take action There is a reason why an engineering team member is required for tech companies & you don’t get funding without one!
Customer Journey….. Couples! Single Ladies!
Old folks: retirement homes? Men! Couples...via the woman! "I like the online content. I like reading about this kind of stuff and i would like buying it too. I think that would be great. Fun and different...interdisciplinary... will you tell me when it’s launched? I really want to use it” Awkward to initiate convo, but want to keep the sexual spark Toys are the “inbetween” boyfriend….but just need 1 toy... Lazy! If it’s not working...i’ll just move on to the next woman! Lots of sex...but not sexy for marketing! Start with young and old will follow "I love this idea. Can you please interview me and my boyfriend? I really want you to “liberalize” him in this area- can we take the quiz?"
Market Opportunity: The sex toy
industry is around $15 billion Target Market Size: $380 million verified through interviews with industry professionals (owner of Unbound Box, Dame Products), customers, and research data (New York Times articles. Acquisition Cost: Verified through SEM campaigns and Google Trends reports Learnings: ● Good engineers are expensive. Budget appropriately. ● Products are high revenue, but high costs. Stocking, affiliate models, etc. all mean different things costs. ● SEM is iffy. Workarounds, playing with ad text is possible, but other channels are surer marketing ● (basically) EVERY ADULT in the world is a potential customer. Take that for TAM! Financial Learnings...
Emotional Learnings... We’re like Destiny’s
Child, we keep losing members, but we’re better each time for it! We went from a team of 5 to 3. The process was incredibly difficult. Yiannis left after Week 1 for personal reasons. Avery was not the right fit and caused pain for our team sorting through the separation. We learned: -- careful who you hire. references, references, references -- once you know, you cannot fire soon enough, cut your losses -- commitment to a shared mission stands above all else (more important than skill) -- workarounds can last you only so long, hire now for what you need tomorrow -- allocate enough, but not too much, time to team emotional development
The product design journey... Game
in Balsamiq Landing Page demo “I got my results….Now what?” Let’s build a site so the game will take you somewhere! But wait? How will anyone find it if we can’t post a single ad due to suspicious content? We’ll just throw some events and do some experiments and lure people that way! On the right track... Offensive! Tacky! We need content! People have lots of questions, and want to feel safe while browsing Game on facebook
Here’s what we did, week
1-2 Here’s what we learned, week 1-2 Began developing workable prototype of Facebook app Facebook app would require significant improvements for workable prototype - are there quicker, leaner experiments? Duration of relationship matters for communication and sexual experimentation/willingness to purchase products People will spend if there’s “guarantee” of added value Verified Target Market Size of $380 million through interviews/data Women are more significant market; have greater needWomen [NOT MEN] purchase sex toys for clitoral stimulation “in-between” relationships Interviewed 44 women and men to refine customer demographics; focused on testing how much men spend on products vs. women, understand the “buyer” of the couple
Customer Segments 25-35 year old
women in relationships -straight -access to Facebook -not an extreme user -6 months in relationship 25-35 year old men in relationships -straight -access to Facebook -not an extreme user -6 months in relationship 22-30 year old women -single or in a relationship -regularly masturbate Business Model Canvas Weeks 3-4 Cost Structure Fee for website domain Shipping Developer salary Rent for working space Revenue Stream 3rd Party Sales Freemium access Ads Key Partners CPG Personal Care Distributors Sex Stores Sex Product Manufacturers Sex Therapists and Specialists Key Activities Develop Usable Mobile App and Online Platform Generate Question Banks and Educational Tools Create platform to sell products Value Propositions Customer Relationships Get: Social media ads, ambassadors Keep: product mixes Grow: viral, word- of-mouth, press Channels Facebook App - ?? E-commerce & content platform--?? Mobile App Direct Sales through Friends Key Resources IT Content Manager Marketing/Branding All New Value Props
Here’s what we did, week
3-4 Here’s what we learned, week 3-4 Surveyed a bus of 52 men and women, 24-34 Males leaned toward Game Males more confident in responding People prefer anonymity (first experiment to show this) Asked interviewees for feedback on existing content sites and mockups Need higher quality concept of what we envision (spent too much time talking about what it would be) Launched new landing page to collect e-mail addresses, began experimenting with facebook/google ads 27 pageviews; 3.7% conversion rate Getting people to site will be major task; we cannot use cost- effective google/facebook advertising to lead strangers to page
BMC Week 5-6 Cost Structure
Fee for website domain Shipping Developer salary Rent for working space Sex Therapist Contractors Revenue Stream 3rd Party Sales Freemium access Ads? Sponsorships through partners Key Partners CPG Personal Care Distributors Sex Stores Sex Product Manufacturers Sex Therapists and Specialists Key Activities Generate Educational Content Aggregate Content Develop Usable Mobile App and Online Platform Create platform to sell products Value Propositions Customer Relationships Get: Social media ads?, ambassadors Keep: product mixes Grow: viral, word- of-mouth, press, quizzes Channels Facebook App - ?? E-commerce & content platform- Mobile App Direct Sales via Friends Key Resources IT Content Manager Marketing/Branding Trade Shows / Conferences Customer Segments 21-35 year old women in relationships -straight -6 months in relationship -3 variables: Sexually active, communicative & adventurous 25-35 year old men in relationships -straight -access to Facebook -not an extreme user -6 months in relationship 21-30 year old single women -single or in a relationship -regularly masturbate
Here’s what we did, week
5-6 Here’s what we learned, week 5-6 Posted ads seeking older women (over 40) to interview and soliciting engineer at different pay grades. Older women have an equal need, but are less open about engaging in anonymous conversation. Market to young women, but expect a wide age range to participate. Adjusted cost in model to $200K/year. Tested which keywords and ad text (focus on sex information, products to buy, vs. couples game to play) via AdWords and Facebook ads and Google Trends reports. People are most interested in opportunities to get questions answered and validated. Also, we face major censorship issues. WOM is most powerful marketing engine. Women see spending on themselves as legitimate. Couples quiz incorporated in content Interviewed founder of a bra company, CEO o Unbound Box (sex toy company), S&M BDSM blogger Sought SEM workarounds like Reddit and WOM program.
Cost Structure Fee for website
domain, Server Capacity Shipping & Fulfillment Developer salary Rent for working space, Office Supplies Sex Therapist Contractors Revenue Stream 3rd Party Sales Freemium access Ads? Sponsorships through Partners Key Partners Distributors Sex Product Manufacturers Sex Therapists Outsourcing: Design, Law, Accounting, Payroll, Benefits, Goods fulfillment Key Activities Generate Educational Content Aggregate Content Develop Usable Mobile App and Online Platform Create platform to sell products Value Propositions Customer Relationships Get: Social media ads?, ambassadors Keep: product mixes Grow: viral, word- of-mouth, press, quizzes Channels E-commerce & content platform- Mobile App Key Resources IT Content Manager Marketing/Branding Customer Segments 21-35 year old women in relationships -straight -6 months in relationship -3 variables: Sexually active, communicative & adventurous Trade Shows / Conferences BMC Week 7-8
Here’s what we did, week
7-8 Here’s what we learned, week 5-8 Hosted sex toy trunk show. Learned if people would come and engage with friends, what people asked and bought. Choice is overwhelming. People want only recommended products. Even reputable companies are unprofessional outdated for modern woman. Updated LoveTap website content to synthesize information and product offerings. To test if people will engage in sexual content & to get a captive audience for a survey on purchasing and engagement behavior, sold out a theater for a pre- screening of Fifty Shades of Grey Before vs after, willingness to pay for intimate products increased by $86.25. Solidified products as part of business model. “Was surprised at the BREADTH of products.” “Fun experience with friends” “I got too overwhelmed by the selection” Hosted two on- campus sex therapist workshops with Anna Randall, licensed clinical sexologist Polled local sex therapists on referral models After understanding what people want to know, we updated content plan for website to reflect that information. Outlined pay for content and patient referral payment/cost flows. Test referral commission, 20% JimmyJane Simplify product cost structure through affiliate program
Here’s where we ended, week
8-9 1. Built MVP 1. Initial Results Goals: products -- would people buy products? which products? what more would they need to know to buy a product? user engagement -- how long do they spend on site? post-use survey -- what worked for them? Distribution: -- reddit “sex” community -- gsb community to provide feedback
MVP Analytics Learnings people are
visiting (and staying!) on our website Validated customer ● Late 20s = avg. age Validated content ● 4+ page-views per session ● avg. site time = 2+mins, ● 85% new users rate ● unexpected organic search rate and referrals ● diverse navigation Not validated selling products. ● Zero purchases.
Lessons Learned 1) Team dynamics
are critical to execution, direction of company and overall success 2) If you can’t stand the heat...then get out of the kitchen, must have a thick skin to deal with company subject matter, negative feedback, and start-up lows 3) Validate your business model segments before investing funds to build it out (will save you $$ in long run) 4) MBAs do not a company make, need to invest in strong technical partner to scale 5) Advertising will be a challenge for this business (google, facebook, even reddit!) 6) Branding & Marketing is key for this business: every product and partnership must be vetted & in the spirit of the mission 7) Top competitors are tacky, sketchy & Next Steps We believe there is a real *need* and opportunity to disrupt the adult intimacy market 1) Rebuild Team 2) Validate selling products o Establish affiliate relationships with product companies once validated 3) Build out content network 4) Apply to summer incubators