In 2014, I quit my $35,000 a year insurance sales job to expand my e-commerce business with my husband Chris.
We had experience selling clothes and accessories on online marketplaces including eBay and Facebook. Our online community of friends and customers quickly grew from a few hundred members to over 10,000 in a very short time. I realized I could combine my passion for affordable clothing and building relationships to help women feel confident in their fashion choices.
Without funding or assurance of what lay ahead, we took the risk and set ambitious goals. I focused on leveraging my knowledge of sales and social media to increase our reach while Chris brought in his financial expertise to structure the deal.
Today we run our online fashion retail business, Pink Lily, full time. Last year, we made $141 million in revenue and sold an average of 11,000 items per day.
Whenever budding entrepreneurs ask me for advice, I tell them that the most important step we took in the beginning was creating a business plan.
Your business plan doesn’t have to be perfect and you should expect to make changes along the way. Here are the five essential elements of the business plan that we used to ensure success:
1. Value proposition and main competitors
Identifying and reinforcing your value proposition – or why customers will want to buy from you over another company – is key.
Before creating Pink Lily, I was very immersed in the retail market. When I wasn’t working full time, I went shopping online. Every time I visited a website or eBay store that I liked, I took stock of what I liked and disliked about them.
I found that there weren’t many options for women that were both trendy and affordable, and I knew I could help fill that need. This was the foundation of Pink Lily’s value proposition.
Here’s what to consider when defining your value proposition:
- Define the product you are trying to sell.
- Write a list of other brands that offer similar products.
- For each of these brands, pretend to be a loyal customer and write down what you think they do well and what they don’t do well.
- During your research, be on the lookout for gaps in the market or areas that these companies don’t serve.
2. Ideal customers
Next, you need to define and put yourself in the shoes of your ideal client.
The more you get to know this person – to the point where you have a fundamental understanding of their decision-making process and day-to-day challenges – the better you can respond to their needs directly.
To determine your ideal client, ask yourself:
- Who exactly are you trying to target?
- Why would they be interested in your products?
- What does a normal day look like for them?
- What makes them happy?
- What frustrates them?
- What are their finances like? For example, what are their usual purchases and how much do they spend on these items?
At Pink Lily, we know our customers are looking for trendy designs and quality options at accessible prices and a wide range of sizes. They love being involved in the products we offer and having a say in the styles we create.
3. The strongest differentiators
What makes you different from other brands? How can you better serve your ideal client? Once you have a solid understanding of what makes you different, you will understand the heart of your business.
Your differentiator can end up becoming the focal point of your marketing strategy and online presence. For Pink Lily, what made us different from other e-commerce brands was that many of our items cost less than $50.
Our customers also enjoy supporting a family business and being part of the Pink Lily family by participating in our community on social media and beyond.
4. Prepare for rapid adoption and growth
To build a scalable business that keeps people coming back, you have to assume that you’ll be extremely successful at attracting first-time customers. Then, create a strategy based on that assumption.
- How will you service all of your customers repeatedly?
- How much money will you need to do this?
- How will you adapt your business to an increasing volume of customers?
- How do you plan to leverage their interest and loyalty to further grow your audience?
5. Social media marketing strategy
Social media has been invaluable to Pink Lily’s growth and success. From the start, we used platforms like Instagram and Facebook to connect directly with customers.
Consider these aspects when developing a social media marketing strategy:
- On which platforms will you publish and when? My recommendation is to post on more than one platform (i.e. Facebook, Instagram, TikTok) at least three times a week on each.
- What content will you post? How will it add value to your target audience or pique their interest?
- How much time will you spend interacting directly with comments? I suggest setting aside as much time as possible to pay special attention to your followers.
I regularly ask our 3.6 million social media followers which products they would like to see on our website or which brands we should partner with. We use their responses to make real-time decisions.
It helps buyers feel like insiders. Their daily commitment has shaped our curation while motivating us to always be a better partner in how we support our community.
Tori Gerbig co-founded pink lily, an online fashion store, became an eBay store in 2011. Today, it is one of the fastest growing online retailers in America. A graduate of Western Kentucky University, Tori resides in her hometown of Bowling Green, Ky., with her husband and three children. Follow Pink Lily on instagram and Facebook.