Pivoting at Break Neck Speed with Irene Falcone, Sans Drinks

Michelle Lomas: Hey there, hustlers. Welcome back to season two of Flex Your Hustle, and do we have an absolutely cracking series for you. This season has it all. From the hustle growth stories, you've grown to love, introductions to new publishers and technology changing the industry, and plenty of revealing moments where we go deep on what it's like to be a founder.

Michelle Lomas: Just like today's episode with Irene Falcone. Irene is probably one of the most interesting and inspiring marketers I think I've ever met. After being frustrated with the low quality, sugar loaded non-alcoholic alternatives that are available in supermarkets and bottle shops, Irene launched Sans Drinks.

Michelle Lomas: Today, Sans Drinks is Australia's leading superstore for premium non-alcoholic beer, wine and spirits, including Australia's first physical non-alcoholic bottle shop in Sydney's Westfield Warringah Mall. Irene is also a bit of a serial entrepreneur, having launched and sold her previous business, Nourished Life for 20 million dollars to ASX listed BWX Limited.

Michelle Lomas: Her open and honest way of communicating to her customers and unique approach as the face of her business has generated much applause and fans throughout the years. This episode is not the usual episode, though, namely because we caught Irene the very same morning she decided to completely overhaul her entire business.

Michelle Lomas: Faced with competition from large retailers like Dan Murphy's and Woolworths. Irene decided to do something pretty huge. Stick around to hear her story.

Irene Falcone: I'm Irene, Irene Falcone, and I am the founder of Sans Drinks, which is the non-alcoholic bottle shop in Australia. That's my second business.

Irene Falcone: And my first business that I founded was called Nourished Life, and that was, like a superstore selling toxin free and natural products.

Michelle Lomas: Let's just get into it. You are a bit of a high achiever, so what is it, from an inspiring perspective, what is it now that you seek out for inspiration and to learn from?

Irene Falcone: This is gonna sound crazy, but how to work less, how to step back, to not make my business the end all and be all. When I sold my company, I sold my soul, and I'm inspired by people that can separate their companies that they founded to them as a person and have a little bit of work-life balance. That's what I'm seeking out the most. The success of my business is so ingrained into how I feel every day.

Irene Falcone: I thought there was something wrong with me mentally. I thought maybe I actually had bipolar, and that's why I'm so successful. That is many people's and successful people's superpower being really high and really happy, and then really low. The swings were so dramatic. So my husband took me along to a GP and I got a referral to a psychiatrist.

Irene Falcone: So I was saying, what, you know, tell me about your manic stages and you are not manic. Then I was like, well, when I get a lot of orders I feel really happy. And when I get a bad review or I've had a slow sales day, I feel really depressed. I was trying to convince him that I had bipolar. But you know what?

Irene Falcone: You don't have bipolar. What you have is a very high, stressful job and have closeness to your business. I think you need to try and get a little bit of balance there.

Michelle Lomas: I mean, it's really hard. We have a lot of founders on this show, and most of them are a bit like you and like what you've just been doing with Sans Drinks, started with a couple of stores here and there, so you might have a couple of retail stores, but predominantly it's an eCom world and like you can't turn off.

Michelle Lomas: It's a every day, the data's in front of you, you're looking,

Irene Falcone: Every time the RBA increases their interest rates, my sales drop 50% the next day. I need to learn and adapt, or else I'm going to go into a mental health spiral.

Michelle Lomas: I mean, we just had, Anthony Nappa from Oz Hair and Beauty was in the studio a couple of weeks ago, and he was talking about the fact that his dad had to step in and tell him to calm down because what would happen is if there weren't enough sales in that hour, he would be going on the website and plugging an order to see if the website had broken.

Irene Falcone: That's what I do.

Michelle Lomas: Because he was that obsessive.

Irene Falcone: Oh, no.

Irene Falcone: I don't have anybody in my life except for my husband who just says 'there's something wrong with you', and yeah, that's exactly right. My husband said to me, 'is everything okay with the website Irene?' The words you never wanna hear as an eCom owner.

Michelle Lomas: Oh no.

Irene Falcone: So I looked on Shopify and like had like hardly had three sales.

Irene Falcone: And I just burst into tears and I was panicking and I was sweating. And anyway, I didn't know what to do and I was, I called my social media guy and I was like, what's happened? Has all the ads stopped? Has something happened, has the credit card maxed out? What's going on? And he said, no, Shopify's reportings down. You've got the sales. Don't worry. It just the reporting issue.

Michelle Lomas: It's all okay. Don't panic.

Irene Falcone: It does unfortunately tell you some information that I don't wanna know. I don't wanna know what is exactly the percentage up or down from the week average to the time, to the minute. I don't wanna know that like, cause we are in an age where we have so much information and so much data.

Irene Falcone: If my ROI's down or my conversion rates down or the returned customers down, it's actually puts me into a little bit of an emotional spin because what is it? Have I upset a returning customer? What's going on? And it's really nice to hear that story that you just said because it makes your life. You're not alone.

Michelle Lomas: Yes, you're not alone.

Michelle Lomas: No, you're not alone. You need like a, a little club of all of you guys to just get together, like a little support group and talk about all the things that you do that you know, keep you up at night. Cuz you all have the same story and I, I don't blame you. It's kind of like the curse of realtime data now right? The more analytics, the smarter we can get with how we run businesses and we target and you know, we put our promotions out there, but at the same time, It can get a little obsessive, right. You can get a little bit obsessed with the numbers and it's that balance.

Irene Falcone: Yeah. And I cannot control the reserve bank. Westpac asked me to come along to something they were doing with the treasurer to talk to the treasurer about how, you know, small businesses are affected by these rate changes and the changes Yeah. Economy. Yeah. How valuable it would be for them to hear from someone like me who is in eCommerce and how it affects people's online spending.

Irene Falcone: I couldn't do it. I couldn't go 'cause I said, it's just gonna end up me being like, you know when you see those people on a Current Affair yelling and carrying on sort of disappointment, inappropriate, it would've been.

Michelle Lomas: They need someone like you.

Irene Falcone: So I just need to like. try and cope.

Michelle Lomas: Yeah. Well look, for the listeners listening, it's been, it is an interesting segue, but let's talk a little bit about, you know, how you got started because your obsessiveness has come from a very long time.

Michelle Lomas: You founded numerous successful businesses, right? One you exited and then another one, we're gonna talk about Sans Drinks as well. And so why don't we start off with a little bit about how you got started, cuz I know you didn't start off as this kind of like serial entrepreneur, right?

Irene Falcone: No, I come from a corporate background. You know, I worked in media since 1992. Not to go that far back, but I do. I worked with John Singleton. He was a big advertising guy back in the day. I remember like a town hall meeting in my agency where the Managing Director told everybody, we are getting this thing called email.

Michelle Lomas: No more faxes. Actually, faxes still stuck around for quite a while, didn't they? People couldn't grasp not sending a fax.

Irene Falcone: Yeah, yeah. No, they were still there. From email it, it developed into access to the internet. And again, I remember this email coming around. Saying it was company policy that we needed to go outside on our lunch break because everyone was so obsessed with this thing called the internet, not leaving their desk anymore, and they wanted to stay at in their desk and Google things. I don't think it was Google, then it was Yahoo.

Michelle Lomas: Ask Jeeves.

Irene Falcone: I think it might have been that one. There was huge resistance actually in corporate to embrace the internet and to embrace emails and those sorts of things. And then I ended up leaving an agency and working in-house at Universal Pictures actually.

Irene Falcone: And that's when, I saw the introduction of Facebook and how we could use social media to talk about movies, and film, and I saw the success of how that would work. And I also got to see the negativity of how that can work against brands as well. So for example, releasing a movie like Bridesmaids where you could tag, you know, who would be your bridesmaid and you could really build great momentum around film by word of mouth.

Irene Falcone: And that was super exciting. But then I, we also locked a movie called the Borat movie, and that movie did very poorly because people came out saying that it was a crap movie. And that again went through on social media. I saw us come out of the John Singletons age where we tell people this is the fridge to buy or this is the margarine to buy versus an era where brands are at the mercy of people's honest opinion of that product. Which will help people know what to buy. In marketing, I thought that was really interesting and then I thought, I wonder how I can then use social media to create my own business that could be driven by people, and I would no longer need a 20 million or a 10 million marketing budget to promote it because I could use the word of mouth and really talk about things that people connected with.

Irene Falcone: And so Nourished Life, my first company was born out of, it was born out of a community of women who wanted better-for-them products without being loaded with parabens and toxins and all of those things that we've been told from reading Dolly Magazine and Cosmo and all of those things for all of those years that we need to put on our bodies.

Irene Falcone: Nourished Life really took off because it was a realistic, honest, true analysis and recommendation on better-for-you products. And so that's how Nourished Life started, threw myself into the world of social media and eCommerce.

Michelle Lomas: Delightful to be able to build a business while you still have a job and then see it so successful that you can actually leave.

Michelle Lomas: I'm curious the difference between then and now, because you built Nourished Life off Facebook to begin with, right? And obviously your channels grew as, as Nourished Life grew. I was working for Unilever, so another CPG company, and we were doing some of the first campaigns on Facebook and MySpace at the time too.

Michelle Lomas: And it was so easy to cut through because there was your friends and then when a brand came in and did something cool, you wanted to engage, it was kind of like the new thing. Now it's a little harder and it's harder to target too. So, you know, building up Sans Drinks now on Facebook versus Nourished Life then, what are you seeing in the differences?

Irene Falcone: Oh, well, I mean, I don't even know where to start, but I talk about this a lot. I went from a hundred dollars to 20 million dollars just by using Facebook. I mean, I just, as soon as I realised that it was a one to 15 conversion rate, just a license to print money. I talk about that a lot. Just put a couple thousand dollars on Facebook, post something that's amazing and telling people about it that, and then it just converted.

Irene Falcone: It was super easy to grow Nourished Life. Very easy, and it was very affordable. And very successful. So I started Sans Drinks in 2020 during the pandemic and the pandemic time of 2020. It was social media heyday, like it was when I started Nourished Life. People were at home on social media again, and they were talking to family again because they couldn't see them in person.

Irene Falcone: So I also had the very same success rate when I launched Sans Drinks and I was able to run ads with my face to tell everyone I'd started a new business and target people who I knew would like natural products. So I was able to get Sans Drinks up and running very quickly, with very little investment in the beginning because of that time and also eCommerce was really having such a great, it was so good, the pandemic.

Michelle Lomas: It was good for so many brands.

Irene Falcone: Yeah, it was really great for eCommerce.

Michelle Lomas: Yeah.

Irene Falcone: Plus it wasn't so good for the delivery because I don't think anyone ever got any of their deliveries.

Michelle Lomas: No.

Irene Falcone: That it was certainly good for sales.

Irene Falcone: Really what killed the ability to be able to use social media to grow a business was that everyone opted out of being followed. And I personally, I mean, I personally don't understand why so many people opted out because to be targeted by ads for things you care about, I can't think of a better way of, we, that's what we want, isn't it?

Irene Falcone: To only see ads.

Michelle Lomas: I don't, I don't want products following me around the internet that I don't care about. I actually just want the products that, you know, I can discover that are completely targeted to me. So I completely agree with you. I do wonder sometimes why consumers don't understand the value of that.

Michelle Lomas: I know the perceived risk and the talk about, oh, they're following me around but it's a very regulated system, it's not like, you know, they, they know absolutely everything about you and you know, they're following, you know, it's just, it's bizarre to me sometimes. I think there definitely needs to be a lot more education in that aspect so consumers feel more comfortable in turning cookies on.

Irene Falcone: I completely agree. And so it's really that turning off of cookies that has stopped the ability for amazing small businesses to be able to reach people who really want those brands, and there has been a huge swing now back to the original days where only the big brands with the really big budget are able to have enough reach now to, yeah, to create a business.

Irene Falcone: Super disappointing because my sales stayed the same or went up, but the cost to acquire the customer

Michelle Lomas: Right.

Irene Falcone: Doubled.

Michelle Lomas: Yep.

Irene Falcone: Yeah. So I had to end up selling my properties and all of the money that I'd made from Nourished Life, in order to continue to drive the same amount of revenue through the business.

Irene Falcone: So that's been incredibly challenging for me, and that's a real shame, actually. Anyway, everyone's moving to TikTok now, and there seems to be some opportunities there. TikTok success can be attributed to the fact that again, it's based on interest targeting so it, you know, knows that if I watch a video on kittens and watch one video on a beautiful cat giving birth to kittens, and now everything on my feed is about cats and kitten things.

Irene Falcone: But yeah, as opposed to Facebook, which is really about connecting with other people and family. Anyway, so I think that's why TikTok is being really successful. And I've started to do more and more on that.

Michelle Lomas: How you going with that? Because TikTok is a bit of a challenge. We had on last year's season, we had the team at Mr. Consistent and Kahrissa came on and she was talking as well, you know, obviously a similar product. Hers is a cocktail mixer, but they also, you know, cater towards the non drink or occasional drinker. She had a lot to say about, you know, the sometimes hard work it takes to cut through on TikTok, there's a lot of rules that brands have to follow, and if you break the rules, you're in trouble.

Michelle Lomas: So how are you going with that?

Irene Falcone: In my personal opinion, TikTok is not a place for brands. And it is not a place for celebrities. And I think that's where a lot of people are going wrong. And I think that Mr. Consistent is a really interesting example because it's a brand. See, for me, I started TikTok with Sans Drinks.

Irene Falcone: And I had very little interest and very little engagement. And then I recently moved and changed it to Irene Falcone, entrepreneur and founder of Sans Drinks. And that's the key, going back to when we started, when Facebook launched and it was all about people really wanting to engage with real people to understand about what brands they really liked.

Irene Falcone: And not brands themselves. That's where TikTok is at. And so if you are a brand, I'm just gonna put it out there, I don't think there's any place unless it's an ad for brands to be on TikTok. The founder of Mr. Consistent needs to be on TikTok and if the founder of Sans Drinks needs to be on TikTok, not Sans Drinks.

Irene Falcone: When you are a brand without a face, it's gonna be incredibly more and more difficult. Anyway, I think they're banning TikTok anyway, aren't they?

Michelle Lomas: So let's see how that paves out. Oh, goodness me. Well let's talk about that actually. It's a, it's a really good segue into what is a key strategy for you around you as the face.

Michelle Lomas: If you know anybody looks at any of your channels, there's a lot of authenticity that comes through. You are the face of Sans Drinks. You are the personality. I love some of your content is just "Here I am in the store. I've just come from a workout" kind of thing, like you don't, you don't polish things. You are what you are.

Michelle Lomas: It's very real, and I know it kind of stemmed back from your Nourished Life days, right?

Irene Falcone: It is the easiest thing to do in the world, being yourself. It's so much easier. It's exactly the same advice I gave back in 2011. I'm gonna attribute my success to the fact that I'm not the polished influencer or a model.

Irene Falcone: I think that a lot of people like my businesses because people really resonate with that, being myself. And people won't like me as well. Like there's people that like me and there's probably people that don't like me as well. I'm probably polarising because I am myself.

Michelle Lomas: Okay. I'm just gonna interrupt here for one minute and give you some context.

Michelle Lomas: The night before this interview, I was scrolling Facebook and saw Irene post a question on whether she should change her business model. This was after struggling for months to keep up with retailers like Dan Murphy's and Woolworths. Starting to stock the same non-alcoholic brands that she stocked. It was highly vulnerable, open and honest, and one of the most surprising posts I think I've ever seen from a founder, and I was waiting to bring it up when...

Irene Falcone: I'm changing Sans Drinks as of last night. I was really struggling with strengths because unlike Nourished Life, it took a really long time for all of the majors to copy my idea. But it took it was really quickly. It was very fast on how quick the Dans and the Woolworths and Coles jumped on the bandwagon of Alcohol-free drink.

Irene Falcone: Yeah, much, much, much faster than Nourished Life. And I thought I'd have a few more years to establish myself and get some momentum, but that happened really quickly and so I put in enough social media so much.

Michelle Lomas: I'm so glad you bringing this up because I really wanted to talk about this post.

Irene Falcone: Did you see it?

Michelle Lomas: It was brave. I saw it. I saw, yep. You posted and you said, guys, I wanna change my entire direction. I've been thinking about it. It was so honest. You know, I think I wanna go down in the direction of premium. What do you think? How brave to just be so open on, you know, your social channels and say, should I just change the entire direction of my business?

Michelle Lomas: You tell me.

Irene Falcone: Yeah at Nourished Life, I do the same thing and I ask questions all the time and I remember I made a mistake once and I actually stocked something that I shouldn't have by mistake and I put a thing out on Facebook and I said, I've made a mistake like I effed up and I'm really sorry.

Irene Falcone: This product includes contains phenoxyethanol and that was a banned ingredient on my policy and I refunded everyone. I said I was really sorry. And I remember at the time thinking this is either gonna make or break my business. I got a reputation of trust. And then I, from there, I just will never, ever break that trust ever with a customer.

Irene Falcone: And I was sort of thinking, I really need to get rid of all these supermarket brands. I was the superstore. I wanna be the superstore. I wanna be the Booktopia of non-alco. And then I realised that the amount of money and the amount of properties and my car and everything that I have to sell to compete with the Dans and the supermarkets on one person is going too.

Irene Falcone: And we just talked earlier about how emotionally attached I am to my businesses and my customers, and how much I care. I don't think I, I could have the mental stability to continually fight that. So like I have one store and one Westfield, and that's awesome, right? But how do I then get 200 stores on my own?

Irene Falcone: One person, right? There's not one person called Dan Murphy's that is sitting at home, right? Signing leases at Westfield, right? There's, it's a huge company and that I just use Dan's as one example, but you know, there's many chain stores out there. So I thought, well, I need to pivot. Like what am I really good at?

Irene Falcone: Like what do my customers really love? And you know what I was scrolling through, this is why I wrote first. I was scrolling through social media and we've got like a private group as well, non-alco groups, like 2000 people in it. And I was scrolling through that as well. And every freaking post was a product that I either created myself, one of my brands that I created.

Irene Falcone: Or it was a brand that I have exclusively. So a brand like Next Destination Wines, where I work exclusively with these wineries to bring the cellar door experience to your home, an incredible quality that is unmatched by anything on the market. Nevermind anything that might be matched at a Dan's or Woolworths right?

Irene Falcone: You would never find a $20 bottle of a 2021 vintage Blanc de Blanc, right? This stuff is incredible. I thought that it was incredible, but to read through all of the people talking about how good these products were and made me realise, very rarely am I, did I see any of the Mcguigans and the Edenvales and stuff that I've seen in the supermarket have such a passionate response on social by people.

Irene Falcone: It takes a lot to take a photo and post it on your own back. Where I thought, I think I found my answer. Imagine if I don't wanna be, or I don't be the Booktopia of non-alc, then I'd be the Mecca of non-alc. When you go into Mecca, it's gonna be a little bit more expensive. I know, but you can still go to Mecca and get something that's affordable.

Irene Falcone: We can still get like, you know, more affordable masks and things. And it's not about the, yeah, it's about a curated range of products that you can't just find in any supermarket or Chemist Warehouse. And they also have a really nice, beautiful selection of their own branded products as well that, that people know is excellent.

Michelle Lomas: That are excellent.

Irene Falcone: And I use, use their oil cleanser. Of course I have to. Same. Can't shop at Nourished Life.

Michelle Lomas: Same.

Michelle Lomas: It's my favorite. The Mecca Oil Cleanser is insanely good.

Irene Falcone: I'm gonna make one of those if I ever get Nourished Life back, but yes. So that made me think, I think that's what I need to do.

Irene Falcone: Then fear kicked in. I was like, I'm gonna lose 40% of my revenue if I do this, 'cause I do still sell a lot of the supermarket brands and they do sell. And I started getting into a panic and I posted that question last night. I said, I don't know what to do. I don't know what to do, and who do I ask?

Irene Falcone: I called up Tony Nash, the founder of Booktopia. I asked him, well, I asked all these people, and I didn't really get the exact answer I needed and I realised, I think I just need to, oh my God.

Michelle Lomas: You actually need to ask your customers.

Irene Falcone: So I asked and, oh my goodness. Right? Did you see the responses? Oh my goodness.

Michelle Lomas: I did. Everyone was extremely positive. They're gonna stick with you if you pick premium, amazing products you can't get anywhere else. You don't care paying premium because you know it's quality. I trust what's in Mecca. Your customers said they're all cult products, so what are you gonna do?

Irene Falcone: I, I love what you just said because I love that word cult.

Irene Falcone: I have taken all of the feedback from all of my customers. And I, first thing I'm gonna do today, 'cause I have to do this recording this morning, and the next thing I'm gonna do is I'm going to change, interestingly, I already rebranded the website and it's much classy announced. It's definitely more premium feel.

Irene Falcone: And I think what I'm going to do is put on clearance, all the brands I'm going to discontinue, I'm going to really pair back, focus on the cult products and if they're not a cult product or I'm gonna make them a cult product now. And what I'm going to do is hire six to 10 everyday experts. I'm gonna have a panel of these people and it's gonna be like the Karen with four kids who lives on the northern beaches, who loves drinking wine during the week and during the weekend, but wants non-alc during the week, I'm gonna have an soccer dad expert who drinks beer, but also likes non-alc beer and I'm going to put together a matrix system on what criteria you need to pass to be stocked on Sans Drinks. And as part of that, you need to have the taste test ticked by the group of everyday experts.

Michelle Lomas: Oh my God, I love this. I love it.

Irene Falcone: I'm going to remove everything off my website that has artificial sweetener in it like aspartame. I'm so sorry, you are gonna go. You're gone off. Gone as in gone. And I'm going to also remove everything that has more than five grams of sugar per hundred.

Michelle Lomas: Oh, please do. It's my bug bear about non-alcoholic wine. It tastes like grape juice.

Irene Falcone: And I'm also gonna cull everything with artificial colours in it. There's nothing against these brands, but I'm gonna make my own ingredients, policy and tasting policy with a team of everyday, just everyday people, that represent the community. And I'm gonna make Sans Drinks yeah, like the non-alcoholic Mecca, that's the only way I can describe it.

Michelle Lomas: Amazing.

Irene Falcone: I couldn't sleep after reading all those comments.

Michelle Lomas: You've just given everybody listening kind of an eye in, or an ear, I should say, into the brain of such an exceptional founder that is obsessive about the customer and you've just like, I can see it, I can hear the excitement.

Michelle Lomas: All off the back of your customer, your customer said what they wanted. You thought about it, you were like, I'm gonna ask them. And they said, yes. And you've just, you're going with it.

Michelle Lomas: There's no, there's no fear or trepidation. You're just going for it.

Irene Falcone: 40% of My sales are gonna go overnight. And my other feedback was around delivery times as well and postage times. You know, it's really hard. I use Australia Post and I love Australia Post as well.

Michelle Lomas: Too hard.

Irene Falcone: Goodness me. Do they love to smash a bottle?

Michelle Lomas: Yes.

Irene Falcone: So I'm actually testing a new delivery partner today. I'm hoping to solve that problem as well. So we need to be able to be nimble enough to pivot on a dime when our customers give us feedback, particularly when it's so overwhelming.

Michelle Lomas: Huge lesson. I think a huge lesson for founders. I mean, it's, you know, it's so easy when you get to your level of success to slow down a little bit on the decision making, and it becomes a bit of a political conversation. Whereas I just love your gusto. You just like, no, we're just gonna do it. I'm just gonna do it.

Michelle Lomas: I already know what I'm gonna do. I know what I have to do. How do you find that confidence in you? Because it's a confidence thing, right? You gotta trust your gut.

Irene Falcone: To be fair, it came out of desperation of the fact that if I continue to go on this journey of trying to compete with the supermarket, then I'm going to lose.

Irene Falcone: I'm not gonna have any goods to sell and I'm going to run outta money, and then I'm going to be forced to have to take on investors. And I don't really wanna do that. I really have always done this on my own, the Irene way. I'm more confident to make decisions when I am only answerable to myself. It was really hard to make a decision on anything when I had sold my company to BWX because Nourished Life was famous, but not stocking Sukin because Sukin was known as a really natural brand, and it was such a great stepping stone into the world of natural.

Irene Falcone: But I never stocked it because it included phenoxyethanol which is an ingredient that's banned by the certification board, it's a preservative, and it was just part of my ingredient policy that I don't stock anything with phenoxyethanol. And for me it was a way to differentiate between natural and fake natural at the time, because at the time, the supermarkets were all stocking the same as they are with the non-alcoholic drinks. So the supermarkets are stocking non-alcoholic drinks that are full of sugar. It's not just me that saying this, read the comments, they're crap. Right? And the same with what was happening with Nourished Life is the. Supermarkets of the Chemist Warehouse was selling all these natural. Products called natural, but they weren't really natural and it was really hard for people to understand the difference.

Irene Falcone: So I thought, I'm gonna draw a line in the sand, so this is gonna be my ingredients matrix, and this is what I'll accept and what I won't accept, and people know anyway. Then I got bought out by Sukin because BWX is the manufacturer of Sukin. Right? And I remember in the meetings when they were acquiring me, but I don't understand, I don't stock Sukin.

Michelle Lomas: Yeah. What, what are you doing?

Irene Falcone: I don't think you should buy me. This isn't gonna work. This is the wrong fit. And they said, we don't care. Don't stock it, then we don't stock it. So I had it written in my contract that I get to decide what I sell and what I don't sell. We were, we were coming into the pandemic.

Irene Falcone: Handwash was really hard to get. And they now stock Sukin on Nourished Life. And I said, you can't. I remember exactly where I was when, when that conversation happened, and I said, well, you can't, it's against the ingredients policy, you knows against my contract and everything. And they said, well, it's up to you, Irene.

Irene Falcone: It's up to you. But people need handwash and we're in a pandemic. So I put a thing on Facebook, said, guys, I would not normally do this, but it's very hard to get handwash now. You couldn't get handwash at the supermarket. This time I'm gonna stock Sukin handwash on my site, but I'm gonna call it out really clearly that it got the phenoxyethanol in it.

Irene Falcone: This is not normally part of my ingredients policy, but we're in a pandemic and I'm gonna let you choose. And people were like, really grateful. Thank you so much. No, we understand. And anyway, and I, we sold a lot of hand wash and that was all great. But unfortunately for me it was a stepping stone. And I think as soon as I left, I think you'll find it a lot of Sukin on there. Now, I haven't checked lately. That was certainly a stepping stone too when the pandemic was over. Did they then remove it? Is it still on there? And there's a lot to be said about integrity. If you are going to make a decision and you're going to listen to your customers, you need to stay true to it and you cannot be swayed by money.

Michelle Lomas: You have to think long term as well as short term and not just the sales that you're driving today, but you know, how are you building that customer base for tomorrow? I am curious because you focus so much on the consumer, making decisions around them and what do they want and what do they care about, which is like such a refreshing way to look at your business, not just, you know, at bottom line and what's gonna sell more product and how do I get as much product out there as possible.

Michelle Lomas: How much of your customer base are repeat customers and how do you continue to drive that loyalty?

Irene Falcone: It's 50/50 every day, being self-funded, I have the, the challenges of cash flow, but I also have the ability to have a business that is 100% consumer focused and I'm genuinely live and breathe it rather than just put it on a PowerPoint presentation when it's a load of crap.

Michelle Lomas: How is that playing out as a strategy for repeat customers for lifetime value you've built two very successful, you know, retail brands off the back of just listening to the customer and being your true and authentic self.

Irene Falcone: Yeah. I think that the customers that, that weren't meant to be will I think Woolworth and Dans will pick up some of my customers and I think that I will gain more customers as more and more people know that I exist and how, what a great job I do on drinking non-alcoholic drinks that taste fantastic and are better for you.

Michelle Lomas: So let's talk a little bit about marketing and you've, again, you've been yeah founder for quite a while, exited one business, launched another one. I mean, let's not ignore the fact that, you know, you stepped into a category non-alcoholic drinks that is really only just growing in groundswell.

Michelle Lomas: It's getting a little trendier now, starting to see some bars and stuff, selling some non-alcoholic wines and stuff, which is quite nice. Cuz not everybody wants to drink. If, even if you are not a complete, like, I don't drink at all. There's a lot of people who just don't like to drink very often.

Irene Falcone: Yeah. 80% of my customers drink alcohol still.

Michelle Lomas: Oh, that's interesting.

Irene Falcone: Which is why it's so important to get the good tasty alternatives for them. I think people that just, yeah, prep people that just don't drink at all either don't like the taste of wine, they don't drink it or they're pretty okay with you tasting like grape juice and that's fine.

Irene Falcone: And they can shop at Woolworths and they can shop at Dans.

Michelle Lomas: Yeah. You're welcome to it.

Michelle Lomas: It does, unfortunately. Yeah. The ones that I've tasted mostly have tasted like, grape juice, but I've had quite a few good little spritzers, I have to say. They do a good job of making a, a non-alcoholic spritz taste like the real deal. Like I'm sitting in Italy on a beach.

Irene Falcone: Or like Aperol Spritz alternative.

Michelle Lomas: Yes

Irene Falcone: I know. I would say that other than gin and tonic, it's alternative. Yeah, they are my second biggest category other than wines.

Michelle Lomas: So let's talk about like marketing and what are the things you've learned over the years? You know, obviously social has been a big channel for you, but what else, has been working for you in terms of sort of driving new customers and driving awareness?

Michelle Lomas: Cuz both businesses have, you've been at the forefront of, I guess, the category and moving the category forward. So what have been some of the tactics that you've done?

Irene Falcone: You know what, I don't have any tactics. I actually don't. Say what I feel and do what I think. And let the customers know what I've found.

Michelle Lomas: That is your tactic.

Irene Falcone: I put a photo up on social media of me in my workout gear, and I'm by the way, very flattered that you thought I'd come back from a workout, post that photo and talk about something that's amazing that I've discovered and or review something. And that will convert to a lot of sales I know with the Barossa Valley Shiraz, that I stock, I said that I thought it was a really good alternative to a Penfold Bin 389. I'm a huge wine collector and I had a full wine cellar full of Penfolds. And Body and Soul picked up on that, and then they did their own review on it, and they said, this is the wine and the non-alcoholic Barossa Valley Shiraz that you can use that that's similar, that I can't say that tastes like a Penfold Bin 389 but it's as close as you're gonna get. Well, I sold 22 pallets.

Michelle Lomas: Wow.

Irene Falcone: Of that wine in one month. The winery ran out of this product that's like 13,000 bottles of one wine in a month, and that was because that Body and Soul article. But I didn't really go out like it wasn't really, it was just me being honest and it got, luckily I got picked up by mainstream media, which is amazing.

Irene Falcone: But the photo of me talking about it in my exercise gear resulted in that sale. Now on the flip side, I recently spent money, I didn't have, doing a very glossy photo shoot for me and my products. And I put the very expensive photo airbrushed. It's very expensive to airbrush me ' cause kept saying, there's wrinkles there's this and that. But anyway, I put that on there and I literally, got two likes.

Michelle Lomas: Yeah.

Irene Falcone: Two likes. Something like that and I hid the photos with no sales. So I think that it's so much cheaper to tell you as well. I have an anti-influencer policy.

Michelle Lomas: I was just gonna ask that. Do you use influencers since you are essentially the influencer for the brand?

Irene Falcone: Yeah. That's a really important point I wanna raise for any entrepreneurs out there that think that they need to hire influencers. You are the influencer as the business owner, you are the influencer and there's one really great thing about being a business owner versus using an influencer. There's two really great things.

Irene Falcone: Firstly, influencers are bloody expensive and, and it's a one short for a one-off thing or whatever as an influencer. And secondly, they need to disclose that it was paid, right?

Michelle Lomas: Yeah.

Irene Falcone: I dunno about you. When I see that someone is being paid to promote a product, I scroll straight past it and I think it has zero credibility.

Irene Falcone: If anything, I think goes against the brand because you had to pay someone to say they liked it, right? If you support anyone that likes, you're probably gonna pay someone to like it.

Irene Falcone: Business owners need to just be the authentic selves and save all that influencer money and put that into something else, maybe paid ads to promote themselves promoting the product as I have in the past used influencers, I have tested it in very early days, early on that I realised I didn't drive anywhere near the sales. I drove myself.

Michelle Lomas: Just by being yourself, I guess. It's a really good lesson for people listening and you as the founder being the face, because there's certainly a lot of cases where a brand has been very successful without having a founder as a face. But I think it's that testament to finding what your authentic voice is and what is going to resonate. And you know, I think you've really found that.

Irene Falcone: What is a great example that I don't think the founder's really on that Frank Body

Michelle Lomas: page.

Michelle Lomas: Yes.

Irene Falcone: It's amazing by the way, it's frigging awesome.

Irene Falcone: But again, they didn't really use paid influencers to build free money. They just used real people using the product.

Michelle Lomas: Yep.

Irene Falcone: And I think its a great strategy too.

Michelle Lomas: I mean, that should be part of everybody's strategy. You know, how do we actually use our customers to be our number one marketing channel?

Michelle Lomas: Your customer is your number one marketing channel. If you look at, you know, the most effective channels for consideration, number one, is referrals from friends and family that I trust. And so, you know, how do you find a way to just build a product? To your point, you've built a product that people love and they feel a part of, they feel invested in because they're actually helping you make decisions for that business, which is such a beautiful way to build that loyalty.

Michelle Lomas: And then they're telling their friends and family about it, and they're getting amazing products. As well, like the best in the market. So that is honestly the best way and, and you know, kudos to you for just like going with your gut and your true self.

Irene Falcone: Thank you.

Michelle Lomas: And like keeping it real and you know, look at the success that you've seen so far.

Michelle Lomas: So I'm really excited to see what this pivot, you know, looks like as well. I think I'm gonna have to get on more, maybe, you know, get some boxes and do some trying some of these better wines because I've only ever tried the cheaper ones and I've always been like, is this the quality? 'Cause I don't really.

Michelle Lomas: I'd rather get the little cans of like cocktails and bits and pieces than, you know, the wine. So I, you've mentioned a few. I think we're gonna have to put some in the show notes and people are gonna have to go and give it a go.

Irene Falcone: There's some really great ones and the reviews are on there. You can see which ones are getting the five stars and which ones aren't.

Irene Falcone: So yeah.

Michelle Lomas: So I wanna ask a question just on some of your performance marketing and, and affiliate marketing specifically, 'cause I know you guys are, are pretty big players in that space. And so I think for people listening they might be a little confused cuz affiliate marketing often gets bundled in with influencer marketing.

Michelle Lomas: So I'd love to hear what you guys are doing in the space and how that's sort of helping you drive business.

Irene Falcone: Affiliate marketing has been the second biggest driver to my businesses at Nourished Life. I use Commission Factory, and it was the best thing I ever did. It was huge 'cause there was a lot of beauty writers and a lot of beauty influencers.

Irene Falcone: That was really great for my business. When I moved to Sans Drinks, it was really hard to get back to the Commission Factory 'cause I was starting from scratch. So I went with another affiliate company, another one, and I was actually like really disappointed with that 'cause I was expecting it to be like blow up, like Nourished Life blew up and it didn't, wasn't the same.

Michelle Lomas: Didn't get the same level of service.

Irene Falcone: I didn't get the same level of service, but more importantly, it actually sunk me financially that it was so expensive. That I decided I wasn't gonna do affiliate marketing anymore. Problematic for me actually.

Irene Falcone: So I decided not to do any at all. And then I saw a decrease in sales and I thought this, this needs to be a better away. So then I asked the agency if they could please try and get me back onto the Commission Factory again, cuz it's been a couple of years now and maybe they'll take me. Yeah, anyway, so I got back on there and now I'm rebuilding my affiliate marketing and I'm doing a nice trajectory, like when I started Nourished Life.

Irene Falcone: So I'm really happy and I'm never looking back again.

Michelle Lomas: Yeah.

Irene Falcone: I've got a little bit of work to do now 'cause I need to build more affiliates. So it's been a bit of a journey, but I'm so happy that I'm doing it. I think affiliate marketing is the last influencer marketing you're allowed to do without saying that it's a pain.

Irene Falcone: It's a pain. Which is great. There's like big button that pops up to say that. I mean, obviously the many people disclose it on their website.

Michelle Lomas: Yeah.

Irene Falcone: But even when you read the disclosures, they're really well done. Like, think like Mamma Mia, for example, would be an affiliate of mine, but they'll say, you know, some of these links, we make a small amount of commission on it.

Michelle Lomas: Yes.

Irene Falcone: But only the links based on products we would've added to the article anyway that we would've promoted anyway. They just happened to have an affiliate link as part of the link to their site. And so it's a very genuine, still and honest. It's not like they're getting paid by one person to promote their product.

Irene Falcone: They could just get the same amount of commission no matter who they promoted. So there, that's where I'm at with affiliate. Let me know and be an affiliate and be a taste tester. That'd be great.

Michelle Lomas: I'm sure most publishers would be willing, or writers or editors out there would be willing to have a taste.

Michelle Lomas: Is there anything in particular, you know, publisher or two that just like kills it for you in terms of sales?

Irene Falcone: Oh yeah. No. The top affiliates for me are not media. They're actually experts in the non-alcoholic drinking space.

Michelle Lomas: Excellent.

Irene Falcone: Yeah. Or I've always found that bloggers with their own community of followers. Particularly those that have beautiful communities that actually want to support the affiliate. So for example, I've got a lovely, a beautiful affiliate in WA and she's a coach for Gray Area Drinking. Her followers know they don't need to click on her website to buy from me, they can buy from me.

Irene Falcone: But they are so supportive of her, they always make a special effort to make sure that they click on their affiliate link and then buy from me. So that way that content creator and coach that makes a living on what she does, gets paid for the free content that she puts out. And I think that's probably one of the most beautiful things about the community support.

Irene Falcone: Knowing that they've just been able to help fund a content creator, make more free content purely by clicking on an affiliate link before they buy, makes absolutely no difference to the consumer at all. They get the same amount of money. In fact, in many cases they get a little bit of an extra discount through that person.

Irene Falcone: So I think that's probably. Knowing my personality now after talking to me, you can see why that would be more special.

Michelle Lomas: Yeah, I can definitely see that. I mean, you're, you're so focused on people and community and listening to the people and, and it's nice that, you know, through such a big company like Commission Factory, you can find some of these more niche bloggers as well.

Michelle Lomas: And how are you sort of built con, continuing that relationship over time? 'Cause there is that ability to sort of grow that relationship, you know, through Commission Factory, right?

Irene Falcone: Yeah. How to grow the relationship through the same bloggers or more bloggers.

Michelle Lomas: Yeah, more bloggers building more and sort of, I, I guess it's kind of like going back to the point that you made before that you are back on the platform, but it's gonna take some time because it does take time.

Michelle Lomas: I think people kind of assume you go in and it's just like a buy and you know, you buy a few bloggers.

Irene Falcone: No, you've got to work on it. Like at Nourished Life, I had a full-time in-house person that did nothing but work on the Commission Factory for me. I can't remember exactly at least I'm gonna say 15 or 20% of my revenue came from affiliates, and that took 10 years to grow with Commission Factory, and it was amazing and I'm so happy to be back there.

Michelle Lomas: I actually have, Emily sitting in the room in the next room, next to me, so she's probably sitting there going thank you.

Irene Falcone: I've used the two top affiliate companies, and I'm back with Commission Factory because part of it is really cost effective as well. Well, and I'm very conscious , of finance cash flow, but it's more community based and more user friendly and more of the bloggers as opposed to just the, the cash rewards. It feels less corporate and less...

Michelle Lomas: performancy.

Irene Falcone: Yeah.

Michelle Lomas: I think there's something about Commission Factory that I feel like they have a lot of the same values as you. It's about creators as well and authenticity, and it's not just about clipping a ticket on a sale and driving as much sales as possible. It's also, you know, understanding how those affiliate relationships and everybody who can be added to the mix can also help brand as well as drive sales.

Irene Falcone: Yeah, absolutely. Yeah. I don't want it to be a commercial. Yeah. I mean, but like in my hands down genuineness of everything. I will never leave the Commission Factory again, and I will never run the risk of not having it on board. I can see my affiliate partners making some days a lot more money than I do.

Irene Falcone: Let's just put this, break this down into a business sense for a second. Let us say what the average affiliate commission percentage across the board to retail. Just use an average example and let's just pick a number. Let's just say 8% commission, right? If we, great. Just give us an example. Now if we think about a business, a retail business that is like an online store that sells products at just say a GP of about 50%, 40 to 50% GP, it's not uncommon for a retail business to maybe haven't ebita of five to 10% profit, just say 8% profit, for example.

Irene Falcone: So if you think about the amount of work and cash outlay. Literally, again, I sold my car and my house to fund a couple of months worth of stock. If you think about the amount of money it takes to build a business, warehousing and storage and wages, payroll, tax, marketing, about all that, less about all the overheads, if you can make even 5% commission. Not having to buy stock. Not having to house it. All you need to do is market it and talk about the product. I'm telling you now, I would way, way prefer to be on the affiliate side of the fence than I'm the store founder side of the fence and so if anyone is thinking about, be getting into affiliate marketing, I mean not this Amazon affiliate marketing crap you see on TikTok, but seriously find a store or a brand you love, then you can run your own business as basically being a franchise almost.

Michelle Lomas: Yeah.

Irene Falcone: Right. Of your brand with any of the overheads at all and still make the same amount of net profit as the retailer.

Michelle Lomas: Is this the next business for you, Irene?

Irene Falcone: No.

Irene Falcone: Righto. No. I mean, it's not because I can't promote other people's products, so I wouldn't.

Michelle Lomas: You don't feel the love of it?

Irene Falcone: Yeah, no. I gonna be the bootstrap founder, then be the rich affiliate. But in general that, that is what I think is super exfiting, 'cause again, I'm customer centric and I'm centric around people. Like mums at homes and stuff, I want them to be able to make income and stuff like that.

Michelle Lomas: Yeah.

Irene Falcone: So for, I think that, for me, I think that's a really interesting way to look at it.

Irene Falcone: So it's a pretty cool thing. And in return, the retailer gets someone. Talking about their product to a community and doing some of the marketing for them, which is great.

Michelle Lomas: Yeah, it is. It's really good. We had we had Jody Allen on here. She was our very, very, very first guest on our first season at Stay-At-Home Mom, and she started her business after being let go, eight months pregnant, no job in sight and no idea what to do. And she built a Facebook community and asked people on Facebook, what do I do? Because I've just lost my job and I'm about to have a child and we're building a house and we've got really bad cashflow. And she had 50,000 moms join her community in the space of two days and give her a ton of advice.

Michelle Lomas: And that's how she built Stay-at-Home-Mum. And majority of her money that comes in is through affiliates.

Irene Falcone: Isn't that amazing?

Michelle Lomas: It's amazing. She's literally built this business of recommending products and tips and tricks and all sorts of other things, recipes and whatever, to groups of mums who just want real advice.

Michelle Lomas: There's an audience out there. There's people listening, and there's money to be made, and it works.

Irene Falcone: You do need to find the right affiliate platform, though. I will say that genuinely.

Michelle Lomas: Yeah.

Irene Falcone: It can make or break you as well.

Michelle Lomas: It's not the easiest thing to navigate as well, and it takes time. It's not just like something that you can do or buy and then does it work or it doesn't.

Michelle Lomas: Like you have to really, you've really gotta test and learn and, and understand that it's gonna take a while before you start to like really see that traction that, you know, really starts to move the needle and you can grow from there. So you kind of need a good partner, don't you? That's gonna take you on that journey and has the right experience and it's just gonna help you through those first few months as well.

Irene Falcone: See, it actually is tricky. The like the setup and stuff from the, not from all retailer perspective, but from affiliate. I remember it being a bit fiddly. So once he gets set up, it's worth it.

Michelle Lomas: We just need more experts in the field too. That's one of the challenges. Not enough experts who run, you know, can sit in the brand side of things as well.

Michelle Lomas: So lucky you've been able to find people on your team that you can sort of put in that position and just go run.

Irene Falcone: Yeah.

Michelle Lomas: Well, Irene, I wanna thank you today. We went way over. This has been such an incredible conversation. I wasn't expecting you know, I knew I knew your reputation as sharing a lot about yourself and the business and putting yourself out there, but I actually wanna thank you for your vulnerability 'cause you were very vulnerable in some moments here.

Michelle Lomas: And I think it's really nice to hear a founder sort of not just talk about the success, but also the things that keep you up at night and the things you continue to work on. Good luck with the pivot. Yeah. I'm gonna let you go now so you can just start to completely change the direction of your company.

Irene Falcone: Exactly.

Michelle Lomas: We'll leave some information in the show notes for anyone who was listening to some of those bottles and names that you dropped. If they wanna try a drop or two. And I wanna ask if we can have you back on the show to hear how things are going. I think I'd love, we'd love, to do a follow up.

Irene Falcone: Absolutely. I would love that. Yes. Let's do a follow up and I'll let you know how it went.

Michelle Lomas: Excellent. I know we're gonna get the honest truth, so we'll be curious to hear how it goes.

Irene Falcone: Thank you.

Michelle Lomas: Have another exciting episode coming up. Here's a sneak peek.

Joel Leong: One thing we'd like to say is that if no one else in this world has ever done this idea before, there are two possibilities for that.

Joel Leong: One, you are the genius out of billions of people. You are the first person you know in a hundred years to found it.

Michelle Lomas: Well done to you.

Joel Leong: Yeah. The other one is that, you know the other, the idea might not be a viable one, and that's why people have tried, they failed and have not succeeded.

Michelle Lomas: If you aren't already, don't forget to follow, so you don't miss an ep.

Michelle Lomas: And while you're there, why not drop us a rating and review? Would love to hear what you think. Flex Your Hustle is made possible by the great team at Commission Factory and produced by Ampel. I'm Michelle Lomas. Keep hustling and bye for now.

Michelle Lomas: Commission Factory.