This week on the Road to Seven, I’m interviewing Tracy Costa, CEO and founder of Peekaboo Beans, a Canadian children’s clothing company. In this episode, we learn about all the crucial pivot points that Traci made to keep up with the changing demands on her business. Tune in to learn how to become more nimble in a changing digital landscape, transform your employees into passionate ambassadors and overcome those obstacles in your road to seven figures.
How to pivot from an idea to a solutions-based business
After ten years of infertility, Traci Costa thought she may never become a parent. However, after another five years, Traci was able to conceive her first child – a truly life-changing moment. Her daughter inspired her to see the world in another light.
Traci’s daughter was busy, active and curious. She quickly noticed that the clothes available for her daughter didn’t really focus on her developmental needs when she was learning to dress and potty train. The clothes didn’t quite accommodate for being active and transitioning activities. On top of that, Traci was deeply concerned that the clothing available to her child didn’t last long – a common trait for fast fashion. At the time in the market, Lululemon was emerging and brought a culture around living a healthy lifestyle. This is when the lightbulb came on and Traci thought, “why isn’t there something like this for kids that focus on a playful lifestyle? Because that’s at the heart of everything is what kids do.”
And from this, Peekaboo Beans was born.
Pivoting towards becoming an industry expert
At first, Traci had no idea what she was doing. She had no background in fashion, apparel, textiles or manufacturing at all, but took a giant leap of faith to try to fill a niche within the marketplace and do something better for kids and the environment. With the drive, passion and desire to create something better, Traci’s first step was to build a business plan from scratch.
With just a high school diploma, she went out and learned everything she could about the industry. She attended trade shows and conferences – whatever was available to learn the apparel side of the business. Eventually, she headed to Los Angeles to learn about textiles, fabrics and design and educated herself locally about all the manufacturing at that time. Traci was able to really immerse herself in the world and learned everything on her own. She found manufacturers, sought out pattern makers and learned the whole design process so she was able to design the product. She also found mentorship in various places such as The Forum for Women Entrepreneurs.
The financial pivot: how she funded Peekaboo Beans
Traci had been working for over 10 years with investment bankers and entrepreneurs helping them build their businesses from an operational standpoint. After witnessing how passionate, driven and hardworking she was, and knowing her story, she presented her business idea to them. They were so happy to help Traci find the capital to fund Peekaboo Beans. Then, she incorporated the company and gained seed partners who put in a percentage of capital while she ran the business. Between 2005 and 2006, she launched her very first collection containing 12 different garments and manufacturing about 3000 pieces available for sale in six sizes.
Traci later took the company public three years ago, which was a massive undertaking but she wanted to take the company to an international level. Her passion for children and sustainability was something she wanted to share with the world.
How to pivot towards growth – marketing Peekaboo Beans
The whole concept was similar to a capsule – presenting “Grow with Me” details to help little thumbs learn to dress with their zippers, easy on-easy off features, mix and match items, and consideration for transitioning activities.
In order to reach your audience, you would make samples to entice stores to order them, place the order and then you would produce those pieces and deliver them. But at that time, Traci didn’t do that. Instead, she had her suitcase containing her sample pieces and travelled from store to store across Canada. Traci was the first sales rep for her own company. Worried that people wouldn’t want to pay the full value for her products, she continued anyways visiting around 400 stores across North America.
People loved the product.
They loved it so much that Traci was able to bring in sales reps from LA, New York, Dallas and, of course, in Canada.
In order to pivot, you need to be nimble
It’s hard to pivot quickly or be nimble to the environment and understand what’s happening in the economy. Traci says that being aware of what’s happening around in the landscape and being flexible with the business is key to your own road to seven. Sometimes things present themselves where you have to create solutions for any gaps or needs in society. This motivated her to start selling wholesale – something she did before e-commerce boomed. When the recession hit in 2008-2009, she quickly found that people weren’t shopping at the stores and they weren’t spending money. Her shops didn’t have the cash flow to keep their businesses going and had to cancel orders.
Traci’s gut feeling, while she was growing the business, was that she didn’t like the process of selling to other retailers and have them selling her product. She found that her products were at risk of losing its voice and brand story. She decided to have a salesforce that would tell Peekaboo Beans’ brand story – they were a collective of people who were passionate about why she created it and become an official ambassador. From there, Traci started to pivot the business to direct sales where this team would hold parties and events promoting her products.
Traci built a direct sales network and started empowering women to be able to sell the product to earn a commission – this ran for five or six years. She then started to recognize that there’s also a change in the direct sales industry – the rise of social media: Facebook and Instagram influencers. People don’t actually want to go to somebody’s house, to be forced to buy something. So as she started seeing the shift in that and the rise of loyalty, points, and referral programs, Traci decided that her team would pivot the business one more time and broaden it to an omnichannel, which really is about meeting the customer where they shop.
At this point, Traci had a bricks and mortar store and an affiliate network where anyone can sell her products through their own link and get credit for that. Whether it be an influencer, a stay at home mom or stay at home dad, anyone can sell the product and direct their audiences to her e-commerce platform. This allowed Peekaboo Beans to broaden its distribution and meet its’ shopper where they shop, where they like to shop. It’s a multi-dimensional platform where you can go into a store and touch and feel the product but then go online and buy it. From software technology, her team implemented Shopify, which is an unbelievable platform for e-commerce and played a significant role in keeping the company relevant to her customers.
For Traci, her success is about resiliency, flexibility, being nimble and reacting when you need to make quick decisions. The number one thing is to trust your gut when you need to start making some changes, but just don’t wait too long!
Start with why and whom you surround yourself with
The first thing you need in order to pivot and grow your business is to have a strong “why.”
Look at the data and monitor your growth – your numbers never lie. Traci encourages us to be really focused on what your numbers tell you – are your sales growing as your sales declining or increasing? Why might that be? Those are big indicators. During moments where your business seems to be going down, you need to look at your “why” and reevaluate whether or not your method of business is aligned with your mission.
For Peekaboo Beans, the reason for its existence is to empower children to play and have a healthy life grounded in play. Your “why” is what gets you up in the morning to fight the battles that you need to fight. When you become extremely passionate about something that needs to change in the world, and you want to be the change that you want to see in the world, then that will get you up out of those hard times.
Traci also advises us to surround yourself with smarter people than you.
Traci recommends drawing from experiences of those you admire or are already succeeding in the industry to create your own road towards seven figures. If you have all of those things, then it can be the guiding kind of force that takes you down the path and that road might show you that what you’re doing is working and to keep going. And in some ways, it will say, “No, I think you need to kind of change.” And this is going to be hard, but it’ll be worth it. It’s about seeing the forest through the trees and just knowing that what you’re doing is for the right reason.
The most important pivot point
In Traci’s experience, the key thing that is the most important point of business is culture and communication within our organization – because people are everything. If you don’t have people all going in the same direction, then you’re never going to accomplish what you need to accomplish.
If you are not aligned with your team, staff, culture and communication, you will get nothing done. You will be constantly managing people, you will be frustrated all the time and will be hiring the wrong people. While your team is in the meeting, try to bring and welcome any conversations to avoid negative speech at the water cooler. It’s about bringing all the background conversations to the foreground in that meeting and having everyone have full transparency. And sometimes you won’t have alignment. There are ways to manage that, but Traci finds the best way is to give everyone the opportunity to move forward in the same direction or work out some of the issues that need to be worked out.
One book that Traci recommends is Dare to Lead by Brené Brown which talks about vulnerability in the workplace, such as shame and vulnerability. We’re all afraid of saying the wrong thing or doing the wrong thing or being shamed. It all comes down from the root of growing up in our own stories and creating safe places for everyone. And there’s a language that all goes along with it so that people can’t shoot something down unless they have a solution to add to it. Once somebody starts feeling open to that it just becomes part of your culture. Treating everyone on the team with respect is also great for hiring – nobody wants to work for a company that doesn’t align with their own beliefs.
Traci reminds us that there’s a solution for everything. If you actually are clear about your reason for being, you communicate with people along the way, you find your network and you find solutions, nothing is the end of the world. You’ll get through things. You really have to have a strong “why” in guiding you through that. Own your story and let your passion and mission transcend into the culture of your company. So many of us just focus on what it is that we sell, but often it’s more than that – it’s the impact we can have on the world.
Resources From This Episode
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