Msnbc your business is sponsored by American Express open, dont do business without it. Your business is sponsors by American Express. Dont do business without it. Hi, everyone. Im jj ramberg. And welcome to your business, the show dedicated to helping your growing business. Does the rise of Online Shopping mean the death of brick and mortar . One pair of entrepreneurs isnt waiting to find out. They have developed a new brick and mortar Business Model that doesnt depend on making sales or stocking inventory and still make a profit. How are they doing it . And will they succeed . We went to Silicon Valley to find out. When you walk into the San Francisco store, every move you make is turned into data. Here you can see that the customer just kind of is walking by, not stopping at this product. But once he enters the zone of the product, it turns green. This is data. And according to the founders, it may be the new face of brick and mortar retail. Our model was not built on sales. It doesnt matter whether you buy now or somewhere else. What did he just say . I doesnt matter to us if you buy now or buy somewhere else. Data doesnt make money from selling the product on display. And the customers are not the people shopping in the aisles. The money data makes comes from the brand explaining the item in the store. Brands is a month ly square feet needed for their products. As we have reported, consumers shift to Online Shopping. The problem is that most people like to shop with a way that is not easy to structure a business around. Huchb ow often do you see pe buying something on their phone while in a retail store . Veboo and fuphillip wonderedf they would make money from these sales . We have hundreds of people walk through our stores and this is a way to get our products discovered in ways they never cou could. And could trained staffers be available to ask questions. I love that customers come here, experience, hands on. If they buy it here, great. If they go somewhere else, thats fine, too. This is a Consumer Electronics company. Beta not only serves as this really makes us great to connect with the yearend customers. The beta stores are a Research Laboratory where manufacturers get realtime feedback on the creation actor. Everything from depression, to shopping, we are looking at things and just counting. You cant see faces here. As you browse different products, were able to stop and measure your attention per product and what ones youre ignoring walking by. I have no model with the p n this. Bob hoffman is a former advertisement owner and industry critic. He worries about privacy issues about the surveillance marketing. When i walked into their store, i should have been notified that im being videotaped. And i wasnt. I think most people know if you walk into any store, youre going to be monitored. There are security cameras there. Theres no difference. The difference is intent. You dont know what theyre doing or what theyre going to be exposed of. . In light of the Customer Data protection, bob suggests it may be dangerous for data to ignore the issues of significant security. If they were to tell, hey, by the way, we use customers and up want to be transparent by that. We dont identify who you are. Then it is gone for everyone. Phillip says he doesnt want to hide anything. And when it comes to privacy we are transparent and have no problem kind of speaking to it. And we are very open about what were doing. He says the content is anonymous and the data is encrypted and stored on the cloud in a security server and deleted in 15 days. Phillip and veboo may see this marketing platform. Thats how we think about it. We are just catching up in the physical world, the Business Model that the internet has enabled. And we were just the first, but there will be a long line of people coming in like this. Long gone are the days when using video to market your company is just for businesses with pockets. Today with not that much work this can work. More than a billion users, they Just Launched youtube director on site. Its so good to see you. Thank you for having me here. Video is a great way to get your message out. Exactly. So we know that Small Businesses have so many stories to tell, everything from why they got the idea, why their customers in, and the video has the full sight, sound and motion to bring that to light. And it is where your customers are. We see more and more people turning to on demand, youtube, you mentioned, aso on. Lets watch a few minutes of this first one. We employ 500 of the best chefs. I land creek oysters, what did they do well there . This is a point park harvester. Not the market first to name the mention off their video, the number of crimes that gives credibility to them. We are eating, drinking and watching the game. We keep an eye on the Culinary Trends while still selling the classic bar food. Here we are going for authenticity. Exactly. I love this one because so many Small Businesses think if youre getting into video advertising, you may need to use expensive actors. And that can be intimidating. Whether it is the Real Customers or employees, it makes your business come to life. You want to check it out. And it is fun for the employees to experience this and share it with their friends also. You dont have that much time. Peoples Attention Spans are relatively small. You have to take all the ideas and stew it down to something simple. It is important to keep your message simple. Focus on one key thing to differentiate your business, why your customer should care about you. One is a company caller hey customerfield, an upholstery video. Why you want to buy old versus new. And then the before and after shots of how the business has made the furniture more beautiful, it makes it clear why you want to work with them. Finally visit warmth. Com today. What did they do that was great . Close the video with a clear call to action. The viewer needs to know, what do they do next . If they want to learn more about business and engage with you. Whether that is showing you the call to action. They ended with their websites to know how to engage in their business. Thank you so much, kate. Thank you for stopping by. Sure. For several weeks now we have been doing our elevator pitch from here at hsn, the original tv network. We have made some dreams come true and we had a few disappo t disappointments. They are going to have a chance to sell their product live here in this studio to millions of households. I wish them the best of luck. So good to see you. Im so excited to hear your pitch. And congratulations for getting this far, its a big deal. Thank you so much, it is, it is. Tell me the name of your product again. Yes. I understand this is four years in the making to you. Youre going to be pitching to two people. These people will decide if you get a chance to be on hsn. How do you feel about this . Oh, my god. Dara and matt, they work for hsn and know what theyre talking about. You look gorgeous, they did a great job on you. The product is great so lets go see it. All right. Hi. Im from chrysmela. Thank you for having me. Chrysmela is the most high it have Tech Security back. Have you ever lost an earring . 86 of us have lost an earring at least once but no more. Chrysmela is the only lock and unlock wingback technology. Debuting in five countries, it uses the same Precision Technology behind iphone cameras. Inside the tiny devices are three it stays lock until you unlock it. No wonder People Magazine called it the most unique invention ever. Im so happy to share this invention that i found in japan with millions of people in the states. Thank you. Perfect timing. Not Perfect Timing for me. I just lost a gorgeous earring that my husband bought me. Which now he knows because i havent told anyone. I need this, what do you think . Good job, by the way. I love it. Quite honestly, im wearing clipones because of the fact that i lose earring backs all the time. Real quick question, though, does it help to hold it in place on the front as well . Yes. Great question. We heard so many customers requesting the lift function, so we developed this. This will give you extra lift and extra support. All right, what do you think, matt, how did she do . Good. One of the things you want to think about is youve had a lot of other potential competitors in the market for earring backs. Play up to what are the true technologies and the benefits of chrysmela, including strength componen components, and this can show the consumer how this can benefit her. She cant stop shaking. This is such an amazing chance for you. Now well find out what the answer is. Is miami going to get the chance to pitch live to millions of hsn customers . Are you ready for this . Now youre shaking again. Its going to happen. All right. Lets hear. Well see if the on air goes. Is she going to get the chance to pitch live . Yea yay thank you so much ooul ill be your first cust. Miami, my god. Four year dms ts in the making we love to make dreams come true, girl. Thank you. What does this mean to you . I dont know. Im speechless. Im just so happy. Im so thrilled to share this. I fell in love with this product when i first saw it in japan on my trip. Did you think you were going to get it on air . I wasnt sure. We are tough cookies. Thank you. We wish you the best of luck. Thank you for the opportunity. Thank you. Im taking these. We love our pets. Americans spent nearly 70 billion on them last year. Inspired by her rescue dogs, marie moody decided to start up a pet food company with emphasis on nutrition and safety. As Jenna Hager Bush tells us, her idea gives two paws up from pooches everywhere. I always loved animals. When i started this, i didnt know it would look like this. Reporter Maureen Moody founded Stella Chewys in 2003, a pet Company Named after her two rescue dogs. The idea came to her after receiving devastated news from her vet. Chewy was a onceinalifetime dog, your soulmate dog. When i first got chewy, i was working with the fashion industry. And he was sick. And the vet said, this dog is not going to make it. And i sorted got this epiphany. I started doing research on food, so their dna is still not 99. 9 wolf. It made a lot of sense about how they went back to eat in the mild. She met chewy meat, fish and vegetables. How did chewy respond . He got 100 better. Not slightly, but 100 better. And he lived to be almost 17. When dud you realize that this is something other people want . I think i started to realize this when i saw how much better chewy got. If you love to your dog, feed it a highquality diet. Reporter she spent six months drafting and what were the early days like . I had industrial freezers for years. I did deliver by taxi and then i got a minivan and turned that into a dlufry vehicle. So you were like, youve really made it. This is the greatest day. Producing this, she needed a new base. She moved it to her hometown of milwaukee where 300 employees now work. And where bring your best friend to work day is every day. This makes it a pretty fun place to work. Yes. You can see, smells food. Reporter these are freezedried all next to the office. This is where all the stella chewy magic happens. Thats right. Talk to me about that transition and why it was so important. A lot of people have difficultying giving up titles or delegating. And that is not an issue for me. When i was able to step back was when he was going into first grade, second grade, third grade. Do you have advice for other women starting their own companies . I think its about you have to really want it. I mean, for me, i felt like i really didnt have a choice. Like, i had to do this. I wanted to do this. Her determination paid off. Today, Stella Chewys is sold in 5,000 Stores Nationwide and is now a multimillion pet food company. This is a great industry to be a part of because it is a happy industry. People love their dogs. What do you think it takes to be a good boss . I think if i had to say, certainly, some degree of compassion and empathy while also being very strategic in able to drive your team. We have launched the Second Season of our podcast been there, built that, and this week were talking to sam yagan currentlyyagen the ceo of shoprunner but is best known for creating okay cupid and match. Com. Sam tells us about starting a small company, what its like to making the transition to being acquired, running a Large Company and why he moved from Online Dating to Online Shopping. I hope you all get a chance to listen to it, its really interesting. The podcast is still pretty new and we love to hear what you think. So go listen for free. Its called been there, built that. You can find it on tune in or wherever you get your podcasts. Still to come, how to properly compensate your sales force, and why you need to keep a close eye on employee engagement. baby crying dont juggle your home life and work life without it. And dont forget who youre really working for without it. Funding to help grow your business. Another way we have your back. The powerful backing of American Express. Dont do business without it. As part of our growth, we are building our sales organization. Im interested in knowing what suggestions or advice you have in structuring our Compensation Plan for our sales force. So i would say that Compensation Plans are not a game of perfect and its really just about getting something done and established. A couple of years ago our sales team had requested that their compensation package would really be more based on objective measures as opposed to subject ive measures so we took that Employee Feedback and implemented a new plan. As we developed that plan, we got most of the leg work done in a reg afternoonly short period of time but there were things we were trying to perfect and realized that no matter what there were going to be some flaws the program. So we decided lets get a new plan in place, take that Employee Feedback in stride. Knowing that the plan wasnt going to be perfect, we also committed to making changes and to adjusting that plan year after year. We now have the top two tips you need to know to help you grow your business. Lets introduce our panel and get their advice. Stephanie was the ceo of a company she recently sold and entrepreneur and investor scott is the cofounder of socket and the chairman of all work and you also just sold a business, so congratulations to both of you. Were getting advice from two very successful people today. Lets start with you, scott. The top tip is what i call the zero marketing strategy. Its just saying no to save your business and to get what you really want. If you think about yourself, you have principles, you have values, things that are like a moral compass that you dont go against. You build the same attributes into your business. As youre building your business and things start to unfold and go into the market, you encounter all different sorts of situations. The retailer you wanted to go into wants your brand but all of a sudden the margin structure doesnt allow you to do it profitably. An investor wants to come in but the valuation is way too low. Its at that moment where you really have to stop and say, no, this is against my plan. If i go forward, my entire plan will fall apart and there will be irreparable damage. So what happens often is if youre really building something of value in the market, at that point of saying no, you get to go out and exercise the business the way you need to do it. What you often find is that those partners end up coming back to the table and you get exactly what you want and youre much stronger for it. But what you also might find is a drop in revenue or something happens along the way, right . You make it sound so easy. You say no and everything turns out great. Really what happens is often you say no, you lose an opportunity and it goes up in the bottom line. You may suffer in the short term but prosper in the long term. Very often youll see businesses making shortterm decisions that dont benefit them in the long run. Mine is regarding surveying employees. Every year we would take an annual survey of our employees and get a feel for what they felt the real issues were. How many employees did you have . 32 employees. How did you get them to tell the truth . Number one, we did do an anonymous survey. But no one feels like its anonymous when theres 32 people. We told them were going to put this out to see the results. I had no idea what the results would be when we took over the business so it was a little bit being vulnerable and saying, hey, lets see whats going on in the business, lets get a baseline and we were just putting forth a fiveyear plan so it gave us an idea of what the hot spots were and how people felt. They knew id be looking right at it and had no problem saying exactly how they felt. I think also what you need to manage in that situation, though, is one person being very fired up about one issue and then not getting it addressed, right, in a way that makes them feel better. So youve opened up the doors, asked me what i think, heres what i think and now youre not changing it. Precisely. So what we ended up doing was showing the results to the entire company in an allcompany kind of allhands meeting. Yeah, we would go right through. It would be very, very obvious what the problems were, what the hot spots were we call them. Yes, youre absolutely right, its very obvious. You could see so many people selected 1 or 2 here but most people were 9s or 10s. Still in, a company of 32 people, one or two people absolutely matter. And you dont know who they are. So we would get in teams, lets all fix this together and figure out some solutions here. I think it gave people a better understanding of these things arent easy to solve and also