Knickey's Cayla O’Connell Davis on how this undies brand used a recycling program drive growth
Joining me on today’s episode I’m joined by Cayla O’Connell Davis, Founder of Knickey.
Knickey is a DTC women’s underwear brand offering the best basic briefs from certified organic cotton--by women, for female-identifying humans. Making organic the everyday option through elevated, affordable intimates, Knickey is for the woke woman who seeks comfort, versatility, durability, and certified sustainability. GOTS, Oeko-Tex and Fair Trade certified to be exact. Because it’s better for your body, your wallet and our world.
This was such a fun episode and it’s packed with plenty of interesting insights and learnings ready for you to take into your own business! Like how a recycling program became the top driver for growth in the business, and how a Booty call service appealed to a new audience, along with Cayla’s learnings as an entrepreneur along the way.
Make sure you stick around to the end to hear her advice for female founders and some resources you don’t wanna miss!
Please note, this transcript has been copy pasted without the lovely touch of a human editor. Please expect some typos!
Definitely. Yeah. So I would say my journey to Knickey was sort of a career long perfect storm, if you will. Um that was enacted pretty much by a personal crisis. Um I had been working in apparel and retail. Um fashion, you know, I've done everything from shopgirl merchandising production and design, even styling shoots and runway. And I was actually pursuing my master's degree of Parsons in fashion studies. And I had sort of a personal crisis when I was studying fashion as an industry and as a system, you know, this was a while back when I started my career but had sort of pulled back the veil on all of the detriment and atrocities, essentially that fashion has on the environment and also the people.
00:04:55 And I had sort of, you know, um a negative personal reflection of, oh my gosh, I'm participating in the system and I need to figure out how I can positively impact this and really try to change it from the inside out because it was a little bit of a disconnect for me at that point in time. And so I actually focus my research and my my Master's thesis on the cradle to cradle ideology, which is a scientific discourse founded by Michael Brown Gert and William McDonough, and that basically sort of rethought the life trajectory and um more linear life cycle of an object um into a more circular and holistic view of production and the life cycle more long term. And so I actually applied that to fashion departments and our clothing and apparel and it was the first time that had been discussed in this context. And um, so I had a lot of a lot of fun research and um I decided I really wanted to sort of put that into action and dedicate my career toward um you know, making more eco minded products for our clothing.
00:06:09 And so when I graduated it was really difficult to get a job just candidly. Um, nobody really understood what I was talking about. People kept referring me to like the communications department and the pr people and um I really wanted to marry design thinking to, you know, product development and to really address sustainability from the start, and that was a difficult thing at the time, This is several years ago, but I ended up working for a nonprofit, briefly, um, the carbon disclosure project which is now known as CDP. Um, and we would aggregate, you know, the world's largest traded publicly companies, their environmental data and put that into like a metric that was used for evaluation by their investors to make sure that they were making, you know, sustainable investments long term, um, which was really wonderful and rewarding. And I learned a lot, but I really wanted to get back to making products. And so I landed a gig with, um, a company that was sort of a start up, if you will.
00:07:12 Um, but it was actually an older company that had been reinvigorated by investors. Um, we were acquired after a few months there and I basically really cut my teeth in understanding, um, and actually putting into practice a lot of the initiatives that I had studied and learning about, you know, organic cotton is the supply chain and um, using recycled poly materials and making, you know, personal care products and delving into the whole world of like clean beauty as well. And so I learned a ton and it was very much like a start up, but without the risk associated with it because we were such a small team, we had very little resources and really just had to figure it all out. And after sort of scaling that to, you know, multinational retailers Bloomingdale's Macy's bed bath and beyond. I was sort of thinking, um, okay, I really want to do this for my own vision. And we had been, um, specifically in home goods for, um, the brands.
00:08:16 And so I wanted to get back to apparel and that's when I took the leap, you know, called my friend Lauren, whom I met at Parsons and said, hey, I've got this crazy idea, do you want to do it with me? Um and so, you know, really it started from just a place of wanting to make an environmentally product and to move education and move the needle for customers more broadly in um you know, just recommended products in the mass market and bring that to apparel because it really, I thought at the time it was not been done successfully. So We started with the concept 1st. Yes, was there any brands who were doing it at that time? Um certainly there were, but I would say that the vast majority of sustainable fashion at that time and the discourse around it just based on my research, I've been doing, my thesis was very much founded in like, abstention and sort of the anti consumption model, you know, like a slow fashion if you will, but really, you know, don't buy anything kind of recycle mend, et cetera, which there is certainly a place for that, but I think that, you know, my thesis was really centered on if we're going to change this industry, we have to do it, we have to change the way it operates fundamentally.
00:09: And um, you know, start from the inside and enact change internally. Um and that starts with just making better products from the start, right? So yeah, we had actually um at the time that I decided to do this, I didn't even know what product we were going to launch with, I just knew that you know, this is the kind of supply chain that I want to build and um this is the kind of brand we want to build. These are the values that we stand for. And so, you know, everything had really going back to your original question really situated itself in more novelty. Like fashion is so ephemeral, right? You know, you get a blouse, it's maybe a print. It's very stylized and you might not like it next season. And that's where a lot of sustainable fashion was sitting at the time as well in sort of these capsule collections that were very inaccessible, Very expensive and we're very niche. And so I was like okay we need to focus on basics because these are high frequency items that people are gonna buy regularly.
00:10:33 And also that's because they're putting it on so much like throughout their lives there, it's also a point of education to really change their thinking about what they put on their body every day. And so underwear was like, you know, the obvious starting point. And so we started with undies. That is so cool. Was there a light bulb moment where you were like, oh my God, it's underwear. Like this is it, definitely. Yeah, I think it was really based on sort of years of marketing eco friendly products to mass consumers, where I kept running into sort of the roadblock of like, oh well this is you know, a seasonal pattern and it fits in with our spring collection, but not our fall collection, et cetera. You know, and I think for me it was like okay, we need to make something that someone is just going to want all of the time. It's not seasonally dependent and what better than to start with. The first thing that everybody puts on every day to reframe their mind about making better choices in their lifestyle more broadly.
00:11:36 I totally love that's so cool. So you joined forces with Lauren, what are the next steps? How do you actually validate the idea and get started? Yeah, So we first started with what we knew my background is really in product development and making garments. And so I started with designs first and foremost beyond that branding. And we spent several months like deep diving into what is Nicky, what is our voice? Who is this? Who is the customer and really defining that personality and doing a lot of research into, you know identity and you know, the behaviors that we think really encapsulate the Nicki brand. We actually had started, you know, thinking about how we were going to go to market and it's such an interesting thing because at the time and this is such a difference now right?
00:12:39 People constantly tell you, oh my gosh I would totally buy you know an eco friendly product if it were available to me because I want to do right by the earth and you know that's a better decision for the world and resources et cetera. But what we found in practice was that when it came down to it people were much more motivated by cost and convenience and so we you know I knew that we had to make Nicky cost competitive, we need we have to make it very accessible so easy to see and obviously the product had to stand on its own and the value add was then it's also eco friendly benefit, it's good for the earth. Um and so we actually started with our marketing narrative if you will as really a better for you product and sort of you know teaching people about you know why you should choose organic cotton for something that's close to your body and your most intimate parts um over you know the synthetics of the world and basically every other underwear product out there so it's better for you but it's also better for the environment and that's that was sort of our starting point and that was just a learning that I had you know come to after several years of marketing earth friendly products to mass consumers.
00:13:52 Um but I think there's been such a shift of late, which is so incredible to see, you know, people are really, I think understanding the value of what they are purchasing, the value of what they're putting on their bodies and I'm considering the entire impact of um a product that they bring into their home. Yeah, that's that's so true and I feel like the last few years people really are making more conscious decisions with everything in their life, not even just um you know, clothing and fashion, but through beauty, what's in their kitchen, what's under the kitchen sink, all that kind of thing. I'm wondering when you started like talking to your friends and your friends are friends and people that you had met at a bar, like all that kind of thing. What were people's reactions when you were telling them about this brand at this point in time at the time? People were super skeptical, I would say um you know, people like, oh, interesting, you know, I think when you have like an idea that is a little bit disruptive, it doesn't always land, you know, um just candidly, but then there were the people whom you know had sat in sort of that world before or knew about, you know, sort of the implications of the fashion industry and that it had to change and they were super jazzed on it.
00:15:04 So you know, I would generally say that like feedback runs the gamut always and always will um and you always have to take it with a grain of salt, but, you know, we we were like, we knew that we had something and we were committed to it, and I think that that's like a huge nugget of advice if I could give that to anybody is just really stick to your story and if you believe in it, you know, that that is what matters, that's the motivation to keep going. So totally for sure. So how do you actually launched the brand? And how do you start finding your first customers and spreading that good word and gaining the momentum that you needed? Yeah, so we spent about a year doing product development um and went to market in late November of 2019. Um we had done quite a bit of proceeding and sending things out to just publishers and getting the word out by gifting, and we launched with a feature on vogue, which was incredible, and that really sort of catapulted us into um you know, understanding what our attraction was, because we had, sort of, you know, thought about, okay, we need to prove product market fit, we're going to put this out there, is anybody gonna want to buy it?
00:16:25 And that was a great moment of validation for us and, you know, as I actually put a lot of strain on our inventory, frankly. Um and uh we have basically just been trying to keep up ever since um and have really grown organically um pun intended I guess, but it's been an incredible journey and we've spent, you know, a year and this just this past year is our second birthday, if you will, you know, really just investing in product and building out stock and improving upon our product, listening to our customers and really trying to understand, you know, where we go next um, and poise ourselves for scaling. Mm Yeah, totally. The exciting part with with all the challenges that also come with it. Yes, of course, up until this point, how have you been funding the business? Um, you know, right from the early days when you decided to leave your jobs, start this new business and you know, through to now.
00:17:28 Yeah, so we're actually entirely self funded. Um we have bootstrapped from day one and that was very deliberate. You know, I have a lot of founder friends, um my husband is actually an investor and works a lot with early stage startups and I had, I wouldn't say become wary, but I was very focused on building a um a business that was not only, you know, sustainable from a supply chain standpoint and from an earth minded standpoint, but also from an economic standpoint. And so I focused really hard on working out the unit economics and making sure that, you know, this is a sustainable business long term from a functional standpoint and we have been very successful in doing that and I'm really pleased because I feel like, you know, it's allowed us to really focus on running the business and growing the business rather than fundraising and answering to external parties. So there is a world in which now that we've sort of proven, you know, market validation and we've had a lot of traction and so much organic growth, um and we haven't been really paying for customers thus far that we we would consider fundraising in order to to really scale um, you know, in a product based business, you always need working capital to scale.
00:18:45 Um and so there there is a moment where I think we're at an inflection point this year, well potentially explore that. Well, that's so exciting goodness. I want to go back to um you know, the marketing side of things, I jumped ahead of myself there, so since you launched last november, and you had the really great vogue press that kind of catapulted you forward and you've had organic growth since then. What are the kinds of marketing things that you were doing to acquire your customers for? For free? Essentially. Yeah, so, I I mean, we have been really big on earned media, we have this recycling program, which is sort of another component of this cradle to cradle ideology, thinking about the supply chain more holistically, and as a circular model for production and when we first launched it, we weren't really sure where it was going to land. You know are people going to be comfortable sending up their old grungy Andy's but they have been and it's actually been a huge acquisition tool for us um and it's very profitable and is a very low cac compared to our digital, you know, spend if you will.
00:19:57 And so that has been sort of our secret marketing sauce if you um you know to to use the funny phrase secret sauce. Um but I would say you know, definitely earned media press, loves to write about a recycling program um and we love talking about it. It's such a, it's a unique thing. It's the first of its kind and we're really addressing a real problem which is that there's no responsible way to get rid of your old underwear, You can't donate it, you can't give it to a homeless shelter, it will just get you know sent to landfill by a third party recycler. And yeah, we've been able to collect that aggregate it. Um you know, palette ties it several tons of the Andes and um make that into installation and sort of industrial rags and pads for commercial rugs. So that has been an awesome, an awesome component of our business that we're so thrilled to see people resonating with. Gosh, I just love that so much. Can you actually explain how it works.
00:20:59 So like does someone buy from your website and then send their old underwear back or do they just like send it to someone else or how does it work? So this is part of what the like finding was. That was so surprising to us is that actually um you don't have to be a Nikki customer. We assumed that once you purchased from us you would then send us back your old undies like in the box because you know, we we pay for the label. But what happens is People go onto our website, you can just submit a request and you just have to indicate, you know, I'm sending you back 13 pairs of socks to bras and 20 pairs of underwear. And then you print out your label, pop it in the mail in any, you know, box that you want to and then we collect it. We partner with a local nonprofit that would normally sort textile waste, but since this is sort of pre sorted, it goes straight to a shredding machine and it gets made into fiber pulp, also known as shoddy. And then that gets made into like insulation.
00:22:00 And so it's technically a down cycling. If we're being technical in, you know, scientific terms. Um we have a long term hopes for a vision for making that more of a robust program um that we can actually pull usable yarn from and start to make it a more closed loop system with our own products. Um so stay two interesting sounds so exciting and so cool. I love that for you. Another thing I saw on your website that I really liked was the booty call uh marketing that you've got going on? Can you share a little bit about that and what the impact has been. Yeah, so, um, you know, Nikki, we definitely want to have um an accessible brand. Um you know, I think our price point is very accessible, which is obviously deliberate. And that on the other hand though, you know, we need to create a very safe space for people because the intimates are very intimate topic. And so I would say that you know, our languages is a little fun.
00:23:02 We try to be lighthearted, we try to be cheeky. Um and you know, just create a warm lead for anybody if they want to call in. We got a lot of phone calls of people calling to talk about issues of the body and fit and um you know post pregnancy and um you know, you name it. And so um it's very much a deliberate act in just in terms of creating a line of communication and to really open it up to anyone who wants to talk about their intimates and it's been really well received and people people love the booty calls thing. So I don't get the really cool thing. That's that's good genius. So wait, do people actually phone you up or is it text messaging. So they phone us. Yeah. Who did they talk to you? They talk to you. Uh they did talk to me, They talked to Lauren as well. We, we entered the phone for about a year. Um and we got a lot of phone calls. We have a set that is very high touch and likes to, you know, call in, it's a little bit of a more mature age group and you know, they're not so internet savvy necessarily.
00:24:14 They like to purchase over the phone and still appreciate the human to human contact. And honestly that goes back to a lot of our strategy with customer experience because you know, I think it's so easy for DDC brands to become so you know, separated and not alienated but there is a wall because a lot of it is anonymous and you don't really know your customers necessarily, but we do, which is so incredible and we try to, we want to talk to them. Um we want to talk to you and um yeah, they call us on the phone and we, we do have a couple of um people on our team now that are dedicated specifically to answering the phone and our fit experts and so gosh, that is so cool. That's a really interesting thing that you just mentioned about the kind of caller who was calling in and I'm wondering if when you were starting the brand, you had a target ideal kind of customer who you thought would be your shopper versus who actually is your customer now, Was there a difference in that?
00:25:18 I would definitely say yes, but to some extent we expected it. What's been interesting is that we targeted a, you know, mature millennial, if you will. Um this individual is very equal minded, they're definitely, they have some discretionary income that they're investing in better products and you know, are active and care about the environment. They believe in climate change and that, that they need to do something about it. Um, but then we have sort of the organic evangelist, if you will, whom baby boomers, they grew up in the seventies, they were sort of the first women who burned their bras, you know, and um, so we knew that we would appeal to them from a product standpoint and they actually find us usually on google um just from searching and yeah, we, we expected them to come, but they have come in droves because they love to call their friends, right? And they're on facebook now and you know, we're on facebook.
00:26:20 So, um it's been a really great thing to see us connect with that audience as well as a DDC brand because they feel like every DDC brand these days is like we're targeting the 25 to 34 year olds and that's it. Um and so, you know, it's really wonderful to connect with that customer and um and they really, they know, you know, they, they understand the benefits of it, they're buying in bulk, they're coming back and their brand foil. Um so it's wonderful and we get to talk to them on the phone, you know, I loved that goodness, that is so cool. Where is the business today? And what does the future look like for you guys? So the business right now is growing really quickly. Um We have had a year of, you know, certainly pivots with Covid and, you know, delays in deliveries and not really understanding what our roadmap is because we've had to plan for contingencies month after month, you know, and shutting down operations so that our our staff could be safe at home and not exposed to any risk.
00:27:28 Um but in spite of all of that, it has been really a positive year for us. Um and yeah, characterized by rapid growth. Um you were hiring full time people and positions. Um we have typically been leveraging the help of external contract consultants for a long time. And so now this year has really propelled us forward into bringing those functions in internally, which is really exciting and, you know, we're really pumped to just keep growing and Italy and innovate and add more product to the assortment. We're launching bras next year, early in the year, we just launched extended sizing um which has been a long term goal for us. Um you know, inclusive video is a big, big topic and uh part of our mission and our ethos and that has been, you know, it is candidly a challenge to, to offer, um, as an apparel business and we're so thrilled to be able to do that now.
00:28:30 And yeah, we're just super pumped. We're keeping, keeping going on the flywheel. So just skyrocketing, Try skyrocketing for, I love that. What advice do you have for women who have a big idea and want to launch their own business? Oh, definitely start with what, you know, you know, I think don't distract yourself with things you don't understand yet find people whom might know a thing or two about it and just ask them leverage those people. Um, you know, like I said, we started with product and that's because that was my background and Lawrence background was in operations and, and retail and so, you know, she contributed that out of the gate, all of the other stuff. You know, we were, we're very happy to go find an expert and bring them on and, you know, pay them handsomely to do that because uh, you know, there's, you know, you need to invest in your people. Um, so yeah, I would just say start with what, you know, I love that and it's so true and I think that's one of those things that it's a really simple thing.
00:29:37 And of course it makes sense, but it can be overlooked and you kind of like, look outwards, I think even for me, I'm someone that I really know social media and all this kind of stuff, but it's probably the thing that gets a little bit left behind and then I'm like that's that should be the thing that I'm so on top of because that's where my background is, you know, anyway, so I digress, you know, if your background is in finance, like build a business model, you know start start writing, you know a model out for what you think the year is. If your background is in social media, start thinking start mood boarding, start thinking about personality and messaging. If your background is in ops, you know, start looking into supply chain partners. Um there's no right way in one place to start. So we are up to the six quick questions part of the episode, Question number one is, What's your wife? Oh um my, Why? That's a great question. My why is definitely to change the fashion industry and propel us toward more sustainable practices and making better products to you know, ensure resources and the world that our kids live in is as good of a place is the one we live in now.
00:30:53 Yeah, totally. Question #2 is what do you think has been the number one marketing moment that's made your business pop Oh um I would say the recycling program launching the recycling program we spoke to a little bit earlier, but you know, I think certainly moments of great press have helped, but the recycling program is just so unique to Nikki and it has brought us so many wonderful customers and a lot of brand loyalty um that I think it contributes longer term to our lifetime value. Overall. Yeah, that's an interesting point to the overall lifetime value of people really feeling connected and wanting to come back and keep, keep buying through you and keep doing the good thing of sending it back. Question # three is where do you hang out to get smarter? What are you reading? What do you subscribe to? What are you listening to every day? Oh, um, I definitely am a big podcast person um, podcast that I've been into particularly that are relevant to our discussion.
00:32:03 Um, masters of scale by Reid Hoffman. It's really quirky, great guests, incredible business founders. Um, Planet Money is like my all time favorite uh, and startup Therapy actually is a really good one. Um, recommend that for any founder, amazing. I'm going to link all of those in the show notes for anyone listening that wants to check them out and I haven't heard of startup Therapy. I'm going to check that out myself. That sounds really cool. Question number four is how do you win the day? And that's around your AM and PM rituals that keep you feeling happy and successful and motivated. Oh, that's nice. Um, I would say, you know, this year it's been difficult to keep her tools. I'm a very routine based person um you know, I love to listen to the daily in the morning when I make my Mata or my coffee or my tea. My husband and I have been doing a lot of walking um you know in the morning, maybe at lunchtime if we're lucky and then definitely to top off the day, watch a sunset, which is a new kind of lovely thing.
00:33:07 As in Manhattan resident, we don't take that kind of time. Um and so that's been really integral to, I think my mental balance, I recently became a beekeeper, which has been such an incredible journey. And so I've been spending a lot of time tending to the girls, checking in on them and doing research there. So that is a small joy for me on a daily basis, definitely. That is so cool. I interviewed um Carly stein from Beekeeper's Naturals a few weeks ago and it is just so amazing like hearing about someone's love for bees and especially because of course in the last few years we've all learned more about bees and and their significance and and products and that kind of thing, but I hadn't really heard from someone directly in depth about beekeeping. And so it was a really lovely chat and I'm also interested in bees now more having, having spoken about it so cool more you learn you just just, it's like wine, the more you learn about it, the more, you know, how much, how little, you know, and it's, it's a yeah, an evergreen discourse and discipline.
00:34:23 Where do you go to learn or like what, what do you do you have like a group or made up or something? So I would love to join my local beekeeping group in East Hampton. However, um they have, you know, they haven't been meeting because of Covid unfortunately. Um I have a local guy that has helped me a little bit. Um it's very much like an apprentice type study. Um it's a passed down past time. There are a few beekeeping podcasts. Um I would say that, you know, some of them are more intriguing than others. There's a really funny one called the Hive Drive. That is very educational, very quirky. Um uh yeah, it's it's a lot of fun and they're on Patreon as well. Patreon is a good um place to find information. Um but yeah, books, I'm gonna check that out. That sounds so cool. Question number five is, if you only had $1000 left in your business bank account, where would you spend it?
00:35:26 I would spend it on product and inventory. 100%. We have found that when we have a product, people buy it. So when we stuck out, you know, they don't, so um I would say that that is, you know, an obvious fundamental thing perhaps, but that is where we have the most value people, you know, by it, they come back. Um and so it would ensure that we could keep going as a business even if that was our last dollar to spend. Amazing And question # six, last question is how do you deal with failure? And that can be around a personal experience or just your general mindset and approach to it? Yeah, I mean failure is sort of an unfortunate but fortunate thing that everyone goes through its inevitable. Um I don't really think about things as failures so much is just like experiences that went a different way than maybe you anticipated and I think if you keep that mind set and then just remember to be agile and to, to pivot and um take learnings from everything that is probably the best outlook and the best way to sort of stomach the pain if it's painful and to get right back up and try again and try it a different way, totally Kayla, thank you so much for taking the time to be on the podcast today.