❌ Failed startup
✅ Successful startup

Howell Market: How Bad Partners Killed an e-Commerce

Howell Market was an online store where individual sellers could go to sell their products. Cody, the founder, partnered with his family and friends, but things didn’t work out as his partners weren’t passionate about the vision of the company.

United States
e-Commerce
People Management

Cody Howell

March 17, 2018

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Hi Cody! What's your background, and what are you currently working on?

My background is in Marketing and in the last 6 months, business development. I got into digital marketing about 3 years ago and fell in love with it. I started out helping friends and family for free to get the experience, and this last year was able to manage just over $8 Million in ad spend!

I have always loved business though. When I was a kid, about 4 years old, I would write stories and sell them to my family members at reunions for $.25. That’s why in the last 6 months I have been focusing on using those marketing skills to actually help grow businesses and get them to the next stage.

What was Howell Market about?

I have this crazy dream to make my name a household name, like Trump, Tony Robbins, etc. I ultimately want to build an empire of businesses. I thought of having an online store like Amazon, eBay, Etsy type of store, where individual sellers could come to sell their products. To get this started, I just went about drop shipping to get traffic to then use to sell the idea. We started with mostly interesting gift ideas, and actually got 1 seller from Ireland to sign up and start selling these really unique suits. 

Howell Market Products

A few of the products were sold!

How did you build it? Which was your business model?

The business was purely online (the site has since been shut down) and was started by my 2 brothers, a friend, and myself.

The set up was to start out with a drop shipping site until we got enough visitors to start bringing on individual sellers. The site started out as just a simple Shopify e-commerce site with a few basic apps.

This was our set up. We had a formula that would tell us our minimum selling price. For example, this shirt would sell for $25 normally, but we would only need to sell for $17.26. This allowed us to know how much discount we could offer and how much influencer take away we could allow.

After getting our first customer to sign up, we quickly realized that Shopify wasn’t going to work and that we were going to need a better system. Unfortunately, we never made it to that new system.

After spending $10 on an Facebook ad we realized that paid ads probably weren't the way to go. We had too low of engagement to be sustainable.

Which marketing strategies did you use to grow Howell Market?

We started out on Facebook and Instagram, with Instagram being 90% of our efforts. We grew our Instagram account to about 500 followers in the first few weeks. We did run a few promotions but didn’t have much success with those as we didn’t have the capital required to compete on a large enough scale.

We focused on Instagram, because of its amazing potential to reach an audience organically. 85% of our sales came from organic Instagram. I actually have written an article on how to use Instagram organically, and this is everything I did and followed with Howell Market.

If I had to go back and redo this, I would have also included Pinterest in our marketing efforts. Pinterest, I think, is one of the most underutilized marketing platforms of today. Pinterest drives traffic and can easily be put on auto-pilot. I was probably spending close to 2-4 hours a day on Instagram trying to grow our account, and on an average Pinterest account I spend about 2-4 hours a week and get way better results!

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Which were the causes of Howell Market's failure?

The short answer is, because of my partners. 

Like I said, I partnered with family and friends. The fact that they are family and friends is actually not the reason it didn’t work out. The reason things didn’t work out is because I choose partners that were unfit to help run the business and weren’t passionate about the vision of the company.

This was my idea, but I invited my friends and family along to help ease the burden of the workload, and I knew I could trust them. I didn’t know though that some were looking for free money, others had no idea what they were doing, and eventually none of them “had time”.

From day 1 I was doing everything from product selection, to marketing, to operations, etc. I would give tasks (not even roles) to the other partners and they would just never get done. I would end up doing them and then move on, cause I was passionate about getting this off the ground.

While this was a side project, we did expect to spend a good amount of time getting everything ready to launch. We set expectations about how long we would give a go before we called it a failure but didn’t even get close (we originally said 6 months but closed after 3).

While partnering with your friends and family may be advisable against, I had a rather good experience. Our relationship grew closer and no hard feelings were left. I would suggest, though, that when choosing partners you choose strategic partners that can cover your weak points. I would also avoid bringing in “Capital only” partners until you can cover all the operations of the business with other partners or employees, because “capital only” means that they won’t help you unless it’s absolutely necessary.

Which is your biggest recommendation about partnerships?

Like mentioned before, choose strategic partners that will cover your weak spots. If you’re not good a marketing, get marketing partner. If you’re no good at paperwork or office stuff, get someone who can do that. I honestly love partners, cause if you choose the right ones, you will have a team of people supporting you and holding you responsible for getting things done.

 

Which were your investments? Did you achieve some revenue? Did you lose any money?

The good thing about online retail/e-commerce is that there isn’t a lot of costs. We had to pay for our LLC paperwork and the monthly hosting fee to Shopify. Our overhead was about $40/month, so that wasn’t anything hard at all.

We did break even before shutting down, but with such low overhead that is only a handful of orders we had to get. Keeping overhead down in any business is key to getting ahead, especially in the beginning.

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If you had to start over, what would you do differently?

I actually have started to do another e-commerce store. I was brought on as a partner, so it’s not my passion project, but my experience has led us to avoid some of these same pitfalls. 

There are a lot of things that I would do over. I think it is easiest if I bullet point them for easy reading:

  • Pick strategic partners
  • Use Pinterest more
  • Stick to 1 niche at first (we went really broad and then cut back to gag gifts)
  • Use others (such as influencers) to get your product and store out there
  • Stay committed. I think with most businesses you have to keep going even when you don’t make money. That’s why keeping overhead low is so important.
  • Focus on quality. People want quality and speed, but the quality is always the most important.

What did you learn?

I think this goes back to the bullet points in question 8. Keep on pushing. Things may not go your way and you may have bad days or even months, but you have to keep pushing. You never know when a big deal is coming and if you close your business, you are closing your doors to opportunity.

Which are your favorite entrepreneurial resources?

I am a big marketing fan, so I tend to study more on that end. I am creating my own learning center where I share what I have learned not only in marketing but also in business. These are my learning resources

I also listen to a lot of Social Media Examiner and Working Without Pants, as those really align with my passions. I really like a book called “The One Minute Millionaire”.

I really like to advise people to find smaller less known authority figures to follow. People like GaryVee, Tony Robbins, Tai Lopez, etc. are all just using their big names to push their own agenda and while you may find some good nuggets, you will have to rummage through a lot of garbage to get it. The smaller guys tend to focus on giving real and insightful information that you can use.

 

Where can we go to learn more?

Like I said, my passion is marketing and business. I have used that to create my own marketing agency, Howell Marketing. We focus not only on your marketing goals but also your business goals. We ultimately want your business to grow. I am always available for questions on Instagram or LinkedIn.

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