Firstly, I want to start by saying "Thank you".
Thank you for the times you’ve told your friends and family about the Thankyou mission, for the advice and ideas you gave us, for every product you’ve purchased for yourself or even that one time you bought nappies when you didn’t need to, to give to a friend who did. Thank you for the launches you’ve backed, the books you’ve purchased and most importantly for the now 755,338 lives impacted because we all decided to come together to make the world a little fairer. Your commitment to Thankyou is what’s got us here, and our commitment to you is to keep building to make sure the impact tomorrow far exceeds the impact we’ve made together today.
Better Before Bigger
"What’s next?" is the one question I get asked the most. Earlier this year I was on the phone to a journalist who asked this question and I said “Get ready for it…the next big thing at Thankyou is…operational excellence”.
It’s not quite as exciting as a new product launch or a new country launch... Or is it?
Financial Year 17 (FY17) was a defining year for Thankyou. We went through growing pains as we experienced that next stage of growth whilst also challenging the empires of some of the world’s biggest multinationals, engaging and uniting a community of parents and breaking ground on the first of many birthing centres in rural Nepal, providing a safe, clean and equipped place for women to give birth and receive healthcare.
The growing pains led us to champion three words this year: Better Before Bigger.
We’re an ambitious team, we’re always dreaming of ‘bigger’ in every meeting, every project, every day, even a morning coffee convo can become a visionary discussion, but we’ve learnt that first, we need to be ‘better’ - at what we do in every team, every system, every process and with every product. Growing pains are a normal part of business growth but before we unpack them…
Here are the humbling, do-cartwheels-around-the-office wins:
In Financial Year 17 we:
- Launched our online store
- Launched an innovation-led nappy range that hit the number two brand in jumbo nappies in its first month against some GIANT competition
- Got our nappy range stocked in Woolworths in June which doubled our projected sales for next year
- Grew our body care sales by 44.43%
- Launched a total of 20 new products in body care and baby
- Shipped 2,516 truckloads of product across the nation
- Launched Thankyou School Sessions and shared the Thankyou story with over 15,477 school students
- Won four awards including Best Website/Online Service at the AMY Awards, Best in Category (Digital Design) at the Victorian Premier’s Design Award for Track Your Impact and ‘Coolest Company’ in the Anthill Cool Company Awards
- Sold over 98,000 copies of Chapter One at a pay what you want price which raised over $1.7 million to help fund our launch into Baby and New Zealand
- Partnered with Freedom Furniture to redesign our Experience Hub to the tune of $10,000 for free, and the amazing team at Thrive Flower and Events who gave us an epic deal on the green wall too
- Funded projects in two new countries - Papua New Guinea and Ethiopia (bringing our total to 22 countries)
- Funded our first maternal and child health projects in Nepal and Zimbabwe giving mums and bubs access to a safe birth and healthcare
- Partnered with World Vision Vanuatu to bring hippo rollers to ease the pain and strain of having to carry water
At the same time, we’ve been gearing up for the launch of Thankyou New Zealand. The first country to launch Thankyou outside of Australia. We’d planned to launch earlier, but while all the amazing things listed above were happening, we were also dealing with some challenges, which caused a few speed bumps and detours for our New Zealand plans (all amazing content for Chapter Two, says our positive side).
Which bring us to...
The challenging, humbling and stop-doing-cartwheels-around-the-office learnings:
Launching Thankyou Baby took double the time and cost than we forecasted
We knew it would be tough - data, research and lots of experienced people told us that - but this was tough plus all its friends.
It’s common when launching into a new market to have to invest more than initially planned, and to refine our nappies and stay on shelf, we had to do just that. It sets us up for future profit wins, but as with all business investments, ultimately it hit this year’s bottom line. Mentors have always told me to double the cost and the time of what you think something will take...mentors are usually right.
We lost shelf space in store
In 12 months we lost 47% of ranging for our food and water range. For water, the category has become heavily commoditised (some days you can buy a 24 pack of water on special cheaper than we can make it). Paired with retailers introducing their private label brands, led to our sales and shelf space decline. We’ll unpack the food realities a little further down.
We got caught up in the waiting game
We had insight that a retailer was going to take our new product range, but in the process it got delayed, delayed and delayed. We set up a team to manage the new business, but the deal landed later than we anticipated. Looking back, it was a short-term problem that has now ironed itself out, but was still challenging for us.
We grew rapidly, but some our systems and structure didn’t grow quick enough
It’s classic growing pains, say all the books, but it really hit hard this year. We’d delayed some major system overhauls, due to budgets (one system costing hundreds of thousands of dollars), with hindsight (gaah) we should have invested earlier.
We invested in an idea that didn’t go to plan
We acquired an online magazine for parents and rebranded it to an online community and marketing platform to sell advertising and use the profit to join our nappies and baby care to fund safe births and healthcare... and it didn’t work. Not everything we launch at Thankyou ‘works’, but everything we launch at Thankyou helps us refine ourselves, learn new things and sets us up to succeed in the future. We rebranded the social media channels to @thankyoubabyaus, and not only gained a ton of valuable lessons but now have our own community of over 50,000 parents!
The Bottom Line
We gave $853,458.80 to help end global poverty in FY17. While it’s a good result, it’s lower than what we had hoped. But considering the tough year and multiple storms we faced, it’s a result we can be proud of.
It means we’ve increased our total funding to $5.5 million to date!
And helped over 755,338 people get access to a safe birth, healthcare, water and sanitation services and food aid.
Better Before Bigger
Growth in business is a huge challenge, but when we consider the alternative is being stagnant, it’s a challenge we’re pretty happy to have. Profitable growth is a bigger challenge. Our challenge at Thankyou is to continually and profitably grow so we can make the most positive impact on ending global poverty.
This year’s been one of refinement, asking hard questions and discovering there are no easy answers (more on that in a moment). We appointed a Chief Operating Officer, invested into new processes and systems (in the past an investment into upgrading a system seemed unnecessary, now we wish we’d done it earlier), restructured the team and hired for new roles. We sat down and looked at the lessons we’d learnt and then made some really tough calls about the future.
‘Better Before Bigger’ meant we called out average products that were draining resource and profit to focus on our core business - to be the best product company, period.
Big Call - we're going to pull out of one of our four categories
This was one of the toughest calls we’ve made at Thankyou. But we made it for an important reason: focus.
Focus is one of the most important concepts in business, and the biggest issue in FY17 was that we lost it.
We’re one of the few brands that competes in four major and quite separate categories - you’ll find our products down four separate aisles in the supermarket. Competing in four unique categories is tough and in short, here’s how we went in FY17:
Water: On the decline... (with our Innovation Team working on a game-changing idea to turn it around).
Food: On the decline.
Body Care: Changing the game. Since launching three years ago it continues to overtake major household name brands in the category.
Nappies and Baby Care: On the rise. While it’s a tough category, it’s showing growth signs similar to our body care range. This product range is in the front seat on the road to greatness.
There’s a wise saying that goes anything is possible, but not everything. So after learning a lot of lessons this year we had to choose the areas we’re going to give our all to and win in. Body care, baby and water
(with the game-changing idea you’ll hear about later next year) all made it through our decision criteria, but food didn’t.
So how did we get here?
In 2013, we set out to create a market-leading food range to help get food aid to people in need.
By 2017, we’d been fighting for three years in the food category and had not won. We were faced with a choice:
invest to win and pull one of our other ranges
invest in other areas of Thankyou that are already winning and lose the food range
We couldn’t do both, so we chose the second option.
Here are the humbling, do-cartwheels-around-the-office numbers that should be celebrated:
- We sold 754,630 cases of food
- Our sales team got the range stocked in Coles, Woolworths, Caltex, 7-Eleven, Officeworks, BP and hundreds of amazing independent supermarkets and cafes
- We funded over 28.7 million days’ access to food aid
- We provided over 130,000 people with access to immediate and long-term food aid in Cambodia, Kenya and Australia
- We funded 60,000 meals at The Salvation Army’s Hamodava Cafe in Melbourne - a place where homeless and disadvantaged people can go to feel safe and have a table-service meal while getting access to rehabilitation services
- We challenged the status quo and created savoury food bars in Lime & Black Pepper and Mexican Chipotle
- We worked with primary school students at Donvale Christian College to develop our mini bars in flavours like MMM Maple and Blueberry Blast
It would be remiss if we didn’t mention the one person who backed it with not just his talent, but also his name. Our Chief Taste Officer, Callum Hann.
Thank you, Callum. You will always be part of the Thankyou family.
What does this mean for the food projects we’re funding?
The answer to this question was the hardest part of the decision, and why we didn’t stop producing food earlier. Taking our food range off the shelf means our funding for immediate and long-term food aid will wrap up at the end of FY18, but before then, we’ll complete funding for all of the projects we’ve committed to.
Together, we made three years of positive change through our funding that we can all be proud of.
Here are some of the stories of change we think should be celebrated:
Christine from Kenya - Mother, Farmer and Savvy Business Woman
Kem Voun from Cambodia - How One Man Farmed a Future for His Family
Raphael from Kenya - A Father's Love and Determination
In business it always comes down to the bottom line. Our bottom line: we joined the game but we didn’t change it.
Our product was great, but great isn’t good enough
We received good feedback and made silver status as a supplier at Woolworths (that’s a good thing). People compared it to the market leaders and we even made the food in some of the same factories. But if you are only as good as a market leader, we’ve discovered you’re basically stuffed. We failed to differentiate ourselves in a big enough way.
We didn’t get to a market leading position
If you’re not in the top third in a category, you find yourself having to put more money into price promotions to stay on shelf which eats away at profit (pun not intended). At the same time, other Thankyou products had reached market leading positions, so we needed to focus on growing them.
We've decided to retire our Thankyou food range. April 2018 will be its last month on shelf. Will we enter the food category again? Maybe. But when we do, it will have to be game changing, not game joining.
I want to stress the team had amazing ideas and strategies to stay and win in the food category but ‘Better Before Bigger’ isn’t just a saying it’s a discipline, so we had to make the tough call not to pull out and ensure every other range is in a market-leading position first.
In every meeting, on every project and every day, we’ll continue to dream for ‘bigger’, and to get there, right now we're learning the importance of being ‘better’.
We’ve already made better systems and processes (and there’s also Ben, our new COO). We’re learning from not just our mistakes but also our successes. We’re focusing on doing less better, not just being busy with lots of stuff.
On a personal note, this has been one of the toughest years. It’s been stretching and humbling and I’ll open up more about that one day in Chapter Two, but what I love about Thankyou is that I walk alongside two of the most remarkable humans (Justine and Jarryd), our incredible board, Leadership Team and wider team who are some of the most gifted minds I’ve met. We’re committed to our purpose: to empower humanity to choose a world without poverty, and while dropping food may look like a step back we believe it’s a step that’s required for us to step up in the future.
A Final Thought
Each day as a team we turn up to what many imagine work at Thankyou to look like:
But actually it could be better represented as this:
We talk about these two pictures a lot at Thankyou, so if you ever join our team don’t say I didn’t warn you. Getting smashed in the face with cold waves over and over in a storm that you think won’t end, doesn’t just sum up inside Thankyou it pretty much sums up the process of pioneering and making ideas and dreams a reality. We’ve been doing it for nine years now and we’re not stopping or slowing. Anyone fighting to make a change will probably resonate.
Here’s our commitment to you
It’s not only about succeeding and never failing. Because we’re human and we know our greatest lessons are learnt from failure. We’re here today because of the failures and how we learnt from them in Chapter One (not a bad read if you haven’t already). It’s not to only failing small either, because we always plan to succeed big (and often do) which means that the size of future failures may grow over time.
Our commitment to you is to learn from every setback, not make the same mistake twice and be open with you along the way.
Most importantly, we commit to never letting the fear of failure stop us from progressing on our mission to empower humanity to choose a world without poverty.
That’s the ‘why’ behind what we do and gives us the perspective we need to move forward.
We (you and us) can never let the fear of failure stop us from chasing our dreams.
Thank you for walking this journey with us and supporting us by buying our products and spreading the word about Thankyou. It's through your support that we've grown this little idea to where it is today. If you loved our food range, firstly, we're genuinely sorry and we’re as shattered as you are. The range will still be available for a few more months, so grab a box, and get ready for a huge 2018 with the launch of New Zealand and many other exciting projects we cannot wait to launch.
Ps. Each year we release a super interactive digital year in review (like these ones) but in light of the above we thought a stripped-back version would be better. Sometimes you have to take a step back to take a step up.
You've made it all the way to the end!
Stay connected by joining the Thankyou Tribe at www.thankyou.co/latest. We'd love to hear your thoughts after reading this report so feel free to drop us an email at [email protected].