This is a follow up story for Lost Empire Herbs. If you're interested in reading how they got started, published over 4 years ago, check it out here.
Hello again! Remind us who you are and what business you started.
Hello, I’m Logan Christopher co-found and CEO of Lost Empire Herbs. We’re an eCommerce company that sells herbal products that help people become healthier and perform better. We cover a wide variety of functions from sleep to mental clarity, athletics to mood, though our biggest focus is hormonal support.
For men, overall testosterone is on a population level decline as a result of rampant endocrine-disrupting chemicals as well as poor lifestyle choices. We’ve got some amazing products, such as our best seller Pine Pollen, which is loaded with Phyto-androgens that can balance out and optimize testosterone.
For women, whose hormones are even more complicated we’ve got a variety of herbs that can help with all the different functions those hormones play role in from thyroid to energy and beyond.
Our company has been “stuck” in the $3 million per year revenue range for the past four years. But our profitability has changed significantly since we initially hit that range. In my previous Starter Story update I shared how our net profit increased 280% from 2020 to 2019.
Well, we did it again, increasing net profits by 154% in 2021. We’re now in a good position to begin growing once again, this time with good cash flow and profitability.
Tell us about what you’ve been up to. Has the business been growing?
The biggest change for the business is we have relocated our warehouse from California out to Missouri. The cost of living for employees, not to mention the taxes, made business more difficult in the Golden State. In this new facility, we’re better poised to expand.
For our internal customers, one of our big pushes has been in increasing our VIP line of products. Customers become a VIP by placing their third order with us. At that point, they get special offers, discounts, beta-testing, and access to our VIP line which includes special and rare items not featured in our normal store.
Marketing wise we’ve had a tougher time. Seeing the increases in Big Tech censorship over the years, I figure that these trends will continue. We lost lots of traffic from what was originally a great channel for us, SEO. Back in 2019, Google’s Medic Update hurt us pretty badly. This is where “alternative health” websites were deranked.
You can see just how badly our SEO traffic went down after that first cliff. It has never recovered since that time despite lots of action initially trying to play by its stated rules.
I didn’t quite realize it at the time but that hurt our new customer acquisition in a big way too. This has continued to fall for some time. Although this chart looks pretty bad, it is great to realize that we’ve been able to hold onto roughly the same revenue working with fewer new customers coming in.
Nor is it just Google. We’ve had many Facebook ad accounts get shut down. We keep getting more and more of our products kicked off Amazon.
So lately we’ve been focused on channels that don’t rely on Big Tech. This has included:
- Podcast Advertising
- Paid Email Advertising
- Alternative Social Media Websites
There have been many failures in these, but more recently some successes along the way. Right now is a time of testing lots of things to find out what works.
A lot of this traffic is driven not just to our eCommerce website, but by specific direct-response funnels. Our best converting offer is our most popular item, a 50-gram bag of Pine Pollen, for just one cent plus shipping and handling. It is currently converting at 3.5% to cold traffic and 5.2% to warm traffic.
We’ve particularly had some good results advertising this on Gab which is a not-well-known social media website, basically a Facebook alternative, with the following ad.
The mere mention of testosterone on Facebook would get the ad banned! But on Gab, we’re going straight for the sale and bringing in customers currently for $18.79.
More recently we’ve just rolled out a new funnel for our Ashwagandha Spagyric Tincture that we’ve begun advertising as well.
In our growth past seven figures, we put teams and systems in place to keep going. But in doing so we lost sight of the bottom line too much.
What have been your biggest challenges in the last year?
The biggest challenge has been a personal one. My wife got a bad case of neurological Lyme disease. That took almost a year to diagnose, in the meantime, we had no clue what was going on with seizures, depression and so much more. In many ways, this forced me to go into a bit of coasting mode with business. The good news was I was able to coast as my team and our systems were in place to keep the business running when I wasn’t always there. Not only that but the difficulty of this situation forced me to deal with some of the baggage from my childhood, repressed anger, and the like. It’s been a disruptive time.
Fortunately, things have been getting better so I’m ready to step on the gas and drive the growth of Lost Empire once again.
Our marketing team has been quite small during the coasting mode, but we’ve just added a new Digital Marketing Manager to the mix, as we focus on increasing the number of new customers coming in.
The challenges we’re facing now are the continued lockdowns in China which are disrupting some of our shipments. Since many of our herbs are from Chinese medicine, we get them in China. The good news is we source herbs from all over the world so even if things stay locked down forever we won’t be destroyed by them. But it could become more painful.
Make sure people understand they are in charge of growth. Responsible and accountable for it. Have goals/benchmarks and if they don’t hit them they are gone.
For these reasons we’ve made some early steps towards more USA-based sourcing as I expect these difficulties to continue for one reason or another.
What have been your biggest lessons learned in the last year?
Going through all of this forced me to get more real about what works and what doesn’t. What is most effective? What is spinning our wheels? It’s looking at the 80/20 principle in all things. For example, I did a hiring/firing analysis of everyone I had ever hired before, whether they were still with me, moved on, had to be let go, or fired. While doing this I realized a few patterns. Here are some of the takeaways I had from doing this:
- Make sure people understand they are in charge of growth. Responsible and accountable for it. Have goals/benchmarks and if they don’t hit them they are gone. This has been the biggest failing, especially on the marketing front. It's easy to make this clear in this area.
- Only one big hire at a time.
- Make sure the hire is for the thing that is needed most. It's easy to grow with hires that don’t necessarily get us to where we need to be.
- Cast a wide net. A couple of decent hires came from the customer list. Others were close or weak link connections. Some met in groups/events. Some were job boards and hiring places. No clear differentiation on what worked better or worse. All over the place.
- Overseas so the rate was good is a theme that seems to make positions more workable. Easier to be worth it from the arbitrage. Since the majority of positions were in the USA perhaps should build this out more globally.
Going through this process helped me in making our last hire.
In addition, I’ve been paying a lot more attention to macroeconomic trends. Sadly, so much of what is going on seems to be utterly dependent on the Fed changing the interest rates and putting the economy into stagflation.
What’s in the plans for the upcoming year, and the next 5 years?
With moving our facility from California to Missouri we’re in a position to scale up our operations. This means doing more in-house production. We’re scaling up our tincture operation and should be starting up capsule production soon enough as well (most of these have been through outside vendors thus far).
Ultimately, we want to not only have our brand, Lost Empire Herbs but also produce and fulfill private-label for other companies as well. We’ve dabbled in this in the past, but want to do it at a larger scale in the future.
Meanwhile, we’ll be expanding what we’re doing on the marketing front. If we can continue to deliver even better products over time, while bringing more customers in, we should be able to cross the eight-figure threshold in due time.
What’s the best thing you read in the last year?
I recently re-read both Deep Work by Cal Newport and The One Thing by Gary Keller. These were useful for helping me to refocus on what is most important and allow the rest to fall away. I’ll be re-reading Essentialism by Greg McKeown again soon which is along these same lines.
Sometimes it is better to re-read good stuff than to always look for the next thing. On that note, I’m also re-reading The 80/20 Manager by Richard Koch which focuses on how to use the 80/20 principle in managing and leading people.
Advice for other entrepreneurs who might be struggling to grow their business?
Life and business go through seasons. It’s a common human fallacy to think that the way things currently mean they’re going to continue to be like that.
Businesses often grow through fits and starts. Most of them are going to hit plateaus at some point in time. Part of this is that what got you to this point is not going to get you to the next level. In fact, what got you there may actually be holding you back from the next level.
In our growth past seven figures, we put teams and systems in place to keep going. But in doing so we lost sight of the bottom line too much. We needed to simplify things to find what was really worth doing and cut the fat. Now that we’ve consolidated and rebuilt a strong foundation, we should be able to grow once again.
And it’s much the same personally. Business is fun and exciting. But sometimes there are personal problems that take a much larger focus, at least for a time. Part of life is in accepting these cycles rather than resisting them as that makes the struggle even worse.
Are you looking to hire for certain positions right now?
We just made one key hire so we’re focusing on making sure that is going well before making the next one. No hires are currently planned as we are content to grow slowly and profitably.
Where can we go to learn more?
You can reach me directly at email at [email protected].
Check out Lost Empire Herbs and especially see our daily email marketing which is a mainstay of what we do by signing up or buying here.
You can also find us on Amazon.
And here are our social media accounts, though we’re not too active on them lately:
Hey! 👋 I'm Pat Walls, the founder of Starter Story.
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