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#009: Armed with Scissors and an Idea a Billionaire is Born. The Spanx Story.

Sara Blakely was getting ready for a party when she realized she didn’t have the right undergarment to provide a smooth look. She cut off the feet off of her control top pantyhose and the crazy SPANX revolution began!  Like all revolutions:  it was not easy.

David Young:

Welcome to the Empire Builders Podcast. Teaching business owners the not-so-secret techniques that took famous businesses from mom-and-pop to major brands. Stephen Semple is a marketing consultant, story collector, and storyteller. I’m Stephen’s sidekick and business partner Dave Young. Before we get into today’s episode, a word from our sponsor which is, well it’s us. But we’re highlighting ads we’ve written and produced for our clients. So here’s one of those.

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David Young:

Stephen, I don’t know, we’re fairly early in the series here but we’re going to venture into the ladies undergarment department is that what I understand?

Stephen Semple:

That’s where we’re going.

David Young:

This is this the story of Spanx.

Stephen Semple:

Yeah. Spanx was started by Sara Blakely in 2000. And she had no history in fashion, of a history in any of those things and she’s now a billionaire. So she took this from 2000 till today she’s a billionaire. And I think anytime somebody does that it’s like pay attention there’s something to learn here. And the story starts with her basically putting on these expensive, she’s going out to an event or a dinner, she puts on these expensive cream-colored pants and there’s panty lines. She’s like, “I don’t want that, that’s not…”

Stephen Semple:

So where did she go to? She goes to the control top pantyhose. But the problem with that is she wants to wear open-toed shoes. She’s got these great open toes shoes that she wants to wear. So she grabbed scissors, chops off the feet, put some on, puts on the shoes and out she goes.

Stephen Semple:

And it’s all great except what happens is the legs keep rolling up. So she then realize well, oh my God. And she thinks to herself and then she looks around she discovers there’s no footless control top pantyhose out there anywhere, like they don’t exist. So she starts figuring out well, how can I make this work? And there’s two lessons in this story. Is the first of all is she discovered a problem that wasn’t being solved. And pretty clear when you think it through it now seems obvious that that’s a problem that a lot of women would face. You don’t want the panty lines you want control top and you want to be able to wear open-toed shoes.

Stephen Semple:

That’s not a stretch that this is a big unsolved problem. So she figures out how to solve the problem but then it gets more interesting as she goes knocking door to door at a top hosier companies to find a manufacturing partner. So she wants to find someone who wants-

David Young:

Who will make this.

Stephen Semple:

Yeah.

David Young:

Yeah.

Stephen Semple:

No, not interested. No, not interested. No. She gets rejection, after rejection, after rejection, after rejection. And then there’s one night she gets a telephone call, honest to God when you hear her being interviewed this is how it’s put. This plant manager calls her and says, “You know what, we’ll help you with your crazy idea. We’re willing to figure out how to make this crazy idea.”

Stephen Semple:

So even this person was like, I’m not really excited but was like, “Well, what the heck. It’s a crazy idea but what the heck. Well, we’ll do a flyer and give you a hand on making this.” So she persevered. The manufacturers all were rejection, rejection, rejection. So you think okay great I got it made now.

David Young:

Yeah. Now she’s got product.

Stephen Semple:

Now I got product. I built a better mousetrap. Billionaire. No.

David Young:

No.

Stephen Semple:

She then hustles. It took her ages going store, to store, to store, to store, to get somebody to actually stock this. And clear as we look at it we go this is a good idea. Anytime something’s a brand new idea, it’s amazing how often people go I don’t think it’ll sell.

David Young:

She had to actually shepherd the product. She shepherded it into production, into existence and then had to shepherd it into department stores that didn’t understand it. In fact, I remember listening to her story in that the first time she got it into a store and I think it might’ve been a Nordstrom’s, I could be wrong on that.

David Young:

But she ended up having to go into the store because they would put it off, buried it behind other hosiery products and she would go in and stand next to the display and engage with shoppers. Physically in the store, shepherding women to actually try the product as well. She had to treat that business as almost a toddler. Like you had to bring this child up and show it the ropes and let people get to know it. It’s an amazing story of perseverance.

Stephen Semple:

Too often we look at it and go well, if I build this better mousetrap, create this better pantyhose, it’s all I got to do. Or now I got this product, now I got the product it’s easy and it’s like, it’s no. Or now I’ve got it into the store, now I’ve got it in Nordstrom’s.

David Young:

Yeah.

Stephen Semple:

A company, I’m done. No.

David Young:

Well, that’s the fallacy of that old saying if you build a better mousetrap the world will beat a path to your door. And I don’t think it actually said that and that’s never the case. You may have a great mousetrap but if you don’t tell anybody about it.

Stephen Semple:

Right. And here’s the other thing that she understood. Is that when she got into Nordstrom’s it wasn’t going to stay in Nordstrom’s if it didn’t sell. So what you need to do even when you finally get the product placed in the location that you want you need to have a marketing strategy for driving business to it.

David Young:

Stay tuned. We’re going to wrap up this story and tell you how to apply this lesson to your business right after this.

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David Young:

Let’s pick up our story of where we left off and trust me you haven’t missed a thing.

Stephen Semple:

You need to have a marketing strategy for driving business to it. Look I used to do work years and years ago, this was actually before I became a Wizard of Ads partner and I was working with a brewery. And this brewery has now since been bought by a national brand or they’re now owned by one of the big brewery. So they did really well. But what we would do is we would get, so in Canada we have these liquor stores that are owned by the government and that’s where your craft beers are sold.

Stephen Semple:

So we would get the man and they would have a certain amount of space of the dedicated for local craft beer. And so we would convince the manager to have local craft beer and they put it in the store. But here’s what we knew if it didn’t sell it wasn’t going to stay.

Stephen Semple:

So we immediately have on the grounds heavy, expensive local marketing campaign just to drive people to the store to buy that beer. Because then what we knew was then when you went to the next store you go, hey, Dave, Dave’s had great success. And also it was an awesome product. We get people trying the product go into that but you can’t just sit there and go, I got a great product, I got it in the store job done. It’s not as simple as that.

Stephen Semple:

Now, there’s a point where you get in Nordstrom’s and you get three or four stores is doing well, it’s a high margin item, everybody else catches on it gets placed well, then the next retailer wants it and eventually that momentum grows the next thing you know you’re a billionaire. But boy, the early days is hustle, hustle, hustle. And don’t expect that just because I got a good idea and I get it made and I get it in a store that you’re going to have success.

David Young:

Yeah. It’s a great story of perseverance it really is. It reminds me of the old Churchill quote, we shall fight in France, we shall fight on the seas and the oceans, we shall fight with growing confidence and growing strength in the air, we shall defend our island, whatever the cost may be. Fight on the beaches, the landing grounds, we’ll fight in the fields and the streets, we shall never surrender.

Stephen Semple:

Yeah.

David Young:

Right. She did not give up. And she had so many reasons too. It’s like, well, I can’t find anybody to produce this I guess. At some point she even quit her really, really good job.

Stephen Semple:

Yeah. You got to pursue this.

David Young:

To keep fighting for this. So that’s an amazing story.

Stephen Semple:

Entrepreneur is hard, but there’s a great positive in this story of the success she had. There’s a caution in this story as well. And the caution in the story is being an entrepreneur, owning a business, shepherding in a brand new product or an idea requires perseverance, requires strength, requires shoe leather, it requires sweat and grit. And if you’re not prepared to do those things, there’s a reasonable chance that you’re not going to succeed. And that’s just the reality of it all. And frankly if you’re not prepared to do those things don’t become an entrepreneur.

David Young:

Thanks for listening to the podcast. Please share us. Subscribe on your favorite podcast app and leave us a big fat juicy five-star rating and review at Apple Podcasts. And if you’d like to schedule your own 90-minute empire-building session, you can do it empirebuildingprogram.com.

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