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Case Study: TRNK

 

 

 

 

 

 

I'm an investor and advisor to TRNK - a New York based home goods startup that is redefining how we shop for our home online. 

TRNK Case Study: How to Build a Brand Online

 TRNK Cofounders Tariq and Nick

TRNK Cofounders Tariq and Nick

 
 

It all started when two roommates decided they were going to fix the online shopping experience for your home...

In the late 90’s, the entrenched players in the home goods space made their first foray into e-commerce. The first iteration was to simply copy their catalogue online with no serious thought to the customer experience. In the process, they lost sight of the two most important things in their business - the customer and what “home” means in their life.

The industry quickly commoditized itself, as the online shopping experience they created encouraged customers to actively price compare creating a long race to the bottom. Brands we’re forced to cut back on quality in order to cut costs so they could remain profitable. The brand-customer relationships built on personal in store shopping experiences devolved into nothing but a price war. 

The internet broke the home goods space. 

TRNK was launched to be the anti-dote. They believe that the home is the expression of self - a reflection of our tastes, hobbies and travels, a place to form fond memories with friends, the best place to unwind after long day’s work.  Your home is not just an address, it is a relationship, it is personal. 

TRNK  was founded because they believed that a digital brand and experience could transcend the modern understanding of e-commerce. They wanted to build a experience that was built on trust and a mutual love for the home. They knew that if we focused on the customer and his journey for shaping his home that they would win in the end. 

WHAT IS TRNK

TRNK is part digital magazine - part curated shopping experience. By foot, by plane and by keypad, they scour the world for exceptional products, designed by established and emerging talent alike. They then carefully edit for cohesion - to create a collection that can live together in a single home. From Japanese porcelain, to Shaker-made wood furniture, the common characteristic is not origin or notoriety, but an undeniably rare and special quality unique to that product.

They spend time with  their products, studying each to ensure that it meets a high standard of materiality and construction. In the end, they only feature those they truly believe are aligned in price and quality, many of which will last you a lifetime. They also maintain a steadfast commitment to authentic, original design (meaning, no copycats).

Their goal is simple, to create a digital shopping experience that is both deeply personal and engaging. That understands that context is critical. That realizes every click, every page, every engagement is a conversation between us and our customers, and that every conversation they have builds their brand brick by brick.

This is the key to succeeding online.

Curate the experience and build an authentic relationship with your customer. The simple truth is that it can’t be bought with digital advertising. It is an art form. It takes time and patience built on continuing to deliver again and again and again. 

This is where we feel TRNK's competitors are failing. They try to compete with the big brands by playing their game. They leverage digital marketing to ratchet up their growth, and are eventually forced into the markdown driven model. Inevitably, their growth slows, the cost of acquisition climbs, the lifetime value of the customer and margins plummet, and the bottom falls out. 

There is a graveyard of massively funded startups that have tried to go toe-to-toe with the big boys and failed. 

We think they are building a better way. But as they say, Rome wasn’t built in a day.

TRNK 2013 - 2016 

Content Drives Organic Growth

Their strategy from day one remained simple: create content that will draw people in organically, and leverage that content to build a relationship with them, and then engage them as customers. 

They built two types of content with slightly different purposes.

Home tours - where they dive into the homes of famous designers, artists, and creators and create a shopping experience around that home. example

Style Guides - where they develop step by step content for how to curate your home style.  Example: How to Pick the Perfect Sofa

They learned fairly quickly that "Home Tours" were a great way to draw people in to the TRNK experience. The stories and their subjects were great shareable content, but they weren’t significant drivers of sales.

Conversely, "Style Guides" gave users the context and confidence they needed to convert into a customer. These guides and the content are fundamental drivers to shopping on TRNK .

Making the Shift to Commerce + Content

As they began to develop a following in 2014, they slowly and thoughtfully began to shift the experience from a content first experience to a more commerce driven model. 

This meant they needed to invest significant time and resources to curating and adding to the assortment of products on the site. They needed more products at the right price point.  This meant iterating the site design and experience, and constantly testing and engaging users for feedback.

The theory was simple, that by building the relationship through content and by slowly adding in products and shifting the focus more on commerce that they would be able to convert readers into consumers, and that every purchase would build on the trust they created through the content. Every time they would come back they would buy more, and more, and more. And when the time comes for them to buy higher dollar items they would come to TRNK.

They have a long way to go, and if they remain patient and build the company the right way they can continue to build relationships with their customers and change the way we shop for our home.

The Results

Lesson #1 - Shift the Paradigm

When you are the new guy don't play the same game as the entrenched market players if you need scale to make the economics work. You'll spend a lot of money trying to scale, without really knowing if the unit economics will be profitable.

Lesson #2 - Every Interaction you have with a customer is your brand

Every page, every word, every email, every image, every click, every action they take defines the relationship you have with your customer. You must take advantage of every moment and think of it as a continuing conversation. Then you have a chance to build a relationship with your customer built on trust and mutual respect. 

Lesson #3 - E-Commerce 3.0 is Content + Commerce

You cannot simply put a catalogue of your products on your website and call it e-commerce. If you don't have Amazons advantage of scale and the supply chain you must engage people with content + commerce if you want to be able to compete. 

Lesson #4 - Great Companies achieve product market fit with little marketing investments

The great test for product market fit is if you can consistently grow revenue month over month without spending a large sum of money on acquiring customers. Turning on a marketing engine is easy after you know who your customer is and what they want.