ENTREPRENEURSHIP / MAR. 14, 2014
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$45,000 a Week 17 Year Old Gives Business Lesson to Weight Loss Industry

A 17 year old student in Australia called Taylor Dow is making big money selling Body Tea, a weight loss herbal tea. Anybody who knows this market in any depth would call Body Tea’s success miraculous. Body Tea has even been featured on Dr. Oz, a show which is well known for the sheer number of different businesses trying to get airtime on it.

Weight loss products- Tough market, tough customers, tough sales needs

These are the issues involved in Body Tea’s success:

  • The weight loss industry is one of the most directly consumer-driven markets on Earth. Every weight loss product comes under direct scrutiny from the industry, dieticians, doctors, and consumer groups.
  • Product reputation matters, a lot. If your product doesn’t work or gets a bad rap from the experts, you get sincerely hated. You, and your products, also get a global reputation a mass murderer wouldn’t envy, and you don’t get customers.
  • Weight loss products are very much hope and expectation-driven. People are trying to help themselves, and the sheer fury at failed weight loss programs and products is quite sincere.
  • This is a very fussy market by definition. Consumers do a lot of research regarding what they buy. The degree of difficulty in sales to a very well-informed, experienced consumer base goes up constantly.
  • Product quality, taste, and preparation are all factors in sales of all weight loss products.
  • User experience for food and drinks is critical. People tend to avoid complex food preparation processes. Tea is easy to make, and Body Tea comes in tea bag form.
  • Price matters. Expensive weight loss products are regarded with deep distrust, after years of lousy, expensive, weight loss products.
  • There are thousands of other herbal teas on the market, particularly for weight loss.
  • The mere use of the word “herbal” gets instant scrutiny from herbal experts and herbal skeptics. Criticism is instant, and often harsh.
  • Direct competition includes a very wide range of other weight loss products. Consumer dollars are tight, highly selective, and often distracted by new products.
  • Achieving profitability is no trivial exercise in this environment. Every facet of sales, distribution, and marketing has to be working brilliantly.

The Body Tea success story

The Body Tea success story has survived this built-in minefield, for a lot of good reasons.

The product and market dynamics here are particularly informative for intending startups:

  1. Good product and product quality

The product is comprised of hyacinth, jasmine, chrysanthemum flowers, Chinese Pu-Erh tea, and citron. These are well-known, much-liked herbal products. They taste good and they’re also very much part of the spectrum of consumer-recognized herbal products.

Body Tea doesn’t use additives, which are both unnecessary for dried herbs and generally distrusted by consumers. The additives are also added production costs, which do nothing for profitability.

  1. Good marketing practices

Body Tea went straight for the prize in marketing- Top of the line market profile, competing with a virtual encyclopaedia of other teas.

The reasons for success become a lot more visible at this point:

Simple product message: Helps with a range of common issues involved in weight loss, like bloating, sleep, etc.

Straightforward pricing- Two options, $29 for a 15 day supply and $55 for a 30 day supply. This is a low price, $2 a day, no sales resistance.

Instantly recognizable simple packaging: Good packaging with a simple logo and bag beats expensive ornamental packaging any day of the week. It’s also much better costing.

  1. Sales

In this market, you expect people to move from product to product. There are also many cheaper herbal teas on the market. People are buying Body Tea, by the ton, from the sales figures. Consumers like it. That’s the real seal of success in the health food/weight loss sector.

Business model

The business model is also a How To manual of no minor significance:

  • Product sourcing: Body Tea is sourced from China, building in a good production cost base. China also happens to be the best possible source for the product components, with strong cultural links to quality control. Good teas are true cultural statements in China, and they only make and drink the best.
  • Product sales: Online marketing, major credit cards, ships globally.
  • Product positioning: Upper middle market, price range above mid-range.
  • Product promotion: Targeting consumers directly through multiple sources.
  • Product information: Very clear, relates to consumer needs and common issues associated with weight loss. Ad copy is straight to the point and deals only with value for customers, a lesson for advertisers.
  • Risks: This product has almost no risk whatsoever of contamination or other types of toxicity, unless materials are exposed to fungi or extraneous chemical effects. Risks of this kind ultimately devolve on the production process, which is responsible for product quality, not the Body Tea business itself. (That’s another good reason for keeping strange, useless chemicals out of herbal products, too.)

This is the classic, best practice, Make/Package/Promote/Sell model for product-based businesses. It’s a no-nonsense model, with all business parameters easily visible and transparent to the business management.

This is also the most realistic, least complex, business model for startups. Complexity isn’t good for new businesses. It tends to be expensive. The fewer moving parts, the better, particularly for any entrepreneurial business.

Mr Dow has done what most people dream of doing- Starting a successful business first try. Market penetration has been total, to the extent that he had to skip school to fill orders. Future expansion, particularly to the very large Asian market, is a likely scenario.

Take the time to study Body Tea, explore the website, and see how a successful startup made it in an incredibly demanding market environment. This is how to do good business, in its most unambiguous form.

Image source: Ausbodytea.com.au

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