The Update: How Milk Bar’s digital transformation has led to sustainable growth

The beauty of digital advertising for us

specifically through the pandemic

is in the flexibility

of when we can pivot.

In this episode of The Update

we talked to Christina Tosi from Milk Bar

about how their digital transformation

has led to sustainable growth.

Tell us a little bit about yourself

and the story behind Milk Bar.

So, I grew up in the Midwest

and went to college for electrical engineering and applied mathematics.

And I ended up somehow moving to New York City

to go to culinary school and work my way up in

fine dining restaurants.

And along the way I realised

that with my love of baking cookies

and being a formally trained pastry chef,

that there was still sort of like a lot of grey area in between.

And so I decided to create my own destiny

and I opened Milk Bar in November of 2008.

And my vision was to create a quirky American style bakery

that served cookies, cakes, pies, and ice-cream

where we could just show up in the world and show up in people's lives on our terms.

So prior to the pandemic,

what was your company strategy and goals for 2020?

Prior to the pandemic

our goals

from a company standpoint

were to continue to think about Milk Bar

as revenue streams for the three channels we exist in.

One is our brick and mortar channel,

which is the channel that I originally opened Milk bar with.

It consisted of 18 store fronts

across the United States.

It was continuing to invest in our online or e-comm business,

which I call our care package business.

And to launch and grow into grocery through our consumer packaged goods line.

So, tell us more about those differences after COVID-19 hit.

When the pandemic hit in the U.S.

it very much gave us an invitation

into the more intimate part of people's lives

because people were trying to find ways to celebrate from home.

Employers were trying to find ways to reward their employees

to say thank you for showing up to work today.

People were trying to figure out how to engage with one another

even though they couldn't celebrate or share that moment together.

We became the conduit for that online which became a really interesting opportunity.

How has your shift to e-commerce changed the revenue makeup of your business?

You know, it's interesting. Because of the pandemic there are...

we have less stores open and therefore less opportunity

to garner the revenue that we're accustomed to

coming in from brick and mortar.

Which means that we're naturally making a shift and we're pivoting to more

sales online.

And you know that is challenging us to look at

the ways in which our business interacts

from operations and fulfilment on down.

With the majority of your bakeries closed during the pandemic,

how has digital been an area of growth for your business?

What we've actually done is taken

some of the resource that we would put into stores

from an advertising and real life standpoint,

and we've pivoted them online.

So we have more ads that exist online

and we have a keener eye and a deeper focus

when it comes to the customisation of those ads online

to educate our customers about

how and when we can be there for them in real life,

how and when they can get their strawberry shortcake cake

in time for their given celebration, and so on and so forth.

We've actually doubled or tripled down

on our online ad space because of our limitations

at our closed stores and so on.

What role did digital advertising, and Google in particular, play

kind of as you made the shift?

We use a lot of

Google Analytics to look and understand

which search terms people

are looking for, from a flavour standpoint.

Which search terms people are looking for, from an occasion standpoint.

When people come to our site,

when and where are they spending the most time?

When do we lose them, if we lose them?

Are they looking for recipes?

Is it about the rainbow sprinkle image?

It's everything visual, and language, and product

that we're studying across the board.

Can you share a little more about how you use, kind of, digital advertising

for you to customise your experiences with your consumers?

What's really, really, really powerful for us from a digital advertising customisation standpoint is

we are able to create and craft multiple different ads

in the landscape to see which one actually lands.

Which one is gaining the most momentum.

Which one is converting in the most powerful way.

And you're able to constantly improve

and pivot and customise from there

until you've landed on places where you're actually getting

the most return possible, you know,

larger and more productive than your wildest dreams.

What advice would you give business owners

who are just starting in their digital advertising or e-commerce journey?

There is so much opportunity and so much

continued untapped opportunity online

and the value of continuing

to double and triple down on our ad space

and the flexibility with which we can

shape our ad and the performance of the ad

is all the more powerful. We are seeing

you know, record CACs beyond our wildest imagination

because of our ability to

be on tone

and to constantly be shaping our message through ads.

And the continued reality that our

community and our customers are spending their time online.

How will that look and change through the remainder of this year?

We're not sure but we're really, really, really excited

about the insane progress that we're seeing in the digital space.

What's next for Milk Bar, and will that change as your stores reopen?

Oh Selin, if I had a crystal ball!

We went into the pandemic with 18 stores,

five of them have remained open through the pandemic.

We've grown our digital footprint in a really really, really exciting and energising way

and we've launched into retail

through grocery stores.

We will continue to ask ourselves the question on a daily basis:

How can we and how do we show up in people's lives?

My sense is that that will continue to be

incredibly powerful in the digital space.

As it relates to stores and in grocery,

we're going to show up every day and figure it out.

It's not for the faint of heart,

but nothing worth doing in life that really matters

is easy.

And so we're here for the challenge.