Millennials are often (lovingly?) mocked, in much the same way as we might tease a younger sibling or child, for their entitled attitude and penchant for the selfie—it even has its own hashtag: #selfieindulgent. However, not everyone in this proceeding stream is a millennial, and they’re not the first generation to feel entitled; that’s generally a defining characteristic of being young.
Negative stereotypes are rarely baseless but they obscure other realities and positives. As Soapstand’s website states: “Milllennials are quickly becoming the most important consumer group. Forbes recently named visible sustainability among the six most important millennial trends.”
The desire to see a fairer and more sustainable world should be applauded these are two elements underpinning Soapstand’s philosophy.
Soapstand: Dispensing The Idea For A Sustainable Soap Business
Abner Tsai, Andy’s co-founder of Soapstand, pitched it to him at the Meetup group he ran for entrepreneurs in Vancouver. Immediately recognizing its value Andy responded, in a manner befitting Cary Grant: “That’s a swell idea.”
The concept is based on that of the Soap Dispensary, a retail store on Main Street, where shoppers can refill their own bottles and not continue to add to the problem of excessive plastic pollution. “She wanted to automate the process,”says Andy, “But she didn’t know where to put it [the vending machines]. He continued advising Abner, but was still yet to become a co-founder of the business, and one of his suggestions was university dormitories.
At this point he was still running his own startup, a firm that turned corporate charity into what Andy describes as an experience: “Employees or customers could vote on where you, as business, give that dollar to. For the company it helped improve their image and brand recognition. We ran a study that found people would remember the charity better by 160% more if you were part of the experience, and able to remember the brand by 60% more if you were part of the experience.”
While succesful it wasn’t what Andy wanted to do forever. He was born into a family that had a business trading chemicals, which did not—he says—propogate his beliefs at a young age that the world needed to be more environmentally conscious. But he was now reaching a point where he wanted to put his philosophies into action. “I was excited,” he says “by getting rid of single-use plastic containers and filling reusable ones with natural products.”
So he wound down this business and took up the reigns with Abner to elevate the bar of Soapstand.
But having, or helping to develop, a good idea is not enough to create a successful business. It’s vital to understand human nature and consumer psychology.
“Preaching Doesn’t Work…” You’re Preaching To The Converted, Andy
“I know preaching doesn’t work. If I scream at you ‘recycle, recycle, recycle or reuse, reuse, reuse’ I’ll be annoying. But if I embed a sustainable experience into your life it’s different. What if it is more convenient? What if it is a no-nonsense better alternative—cheaper, faster, better, everything—you wouldn’t really think about whether it was green or not. You’d just think it’s better.”
While I find this practical and not cynical I am curious as to his motivations, so I ask the question: what problem are you solving?
“So this is an interesting one,” admits Andy. “To the consumer we’re not solving a problem… What we do is bring retail to their house, to their apartment building, to wherever they are. We make it convenient to purchase these things. For the consumer there isn’t a problem there is just an opportunity.”
But he goes on: “For the environmentalist there is a problem. The environmentalist, which is a smaller subset [of consumers], they want to refill, they want to do more, they want put their ideologies into action.”
Andy has spoken to many people in the US to pitch this idea, and the concept of refilling natural soap is just not something the average US consumer is thinking about. “There’s nothing like zero waste [in the US], it’s quite difficult there.” But he goes on to suggest products such as milk, a hot commodity in the US, could be dispensed this way.
Technology, Spring and Future Plans
The vending machine technology is pre-existing, all that needed to be created is bespoke software to link the touchscreen interface to the mechanisms that dispense soap. The key to it all, says Andy, is the flow sensor.
“It’s really simple. There’s a keg of soap with a tube linked to a pump. Then another tube that passes the soap through a flow sensor, which tells us how much soap has been used. For a flow sensor to be that accurate would usually require an industrial one that costs hundreds of thousands of dollars but we were able to produce one for $4,000. On the other end is a valve which opens and closes and releases soap into a bottle. And it’s all controlled by a touchscreen. That’s it.”
The flow sensor not only measures how much soap has just been bought, it can also understand the cumulative math and uses that to preorder the delivery—making this easier still for potential partners to buy into.
Interestingly, the machines are engineered in Canada, with Andy citing it is cheaper and certainly faster. If the time comes when he is manufacturing thousands it may well be that the engineering is shipped overseas.
Soapstand has been around for about two-and-a-half years, but only since last year as an active business. A lot of the precursor time was spent in research and development. Andy also went through a business program with the accelerator Spring, in Downtown Vancouver, which he says was a great help.
The first machine went into a building in the spring of 2017. At the time of the interview [January 2018] Soapstand is operating in three locations and shortly hopes to be in 14.
But interest is growing, including from the States, which Andy previously noted has been proving a tough nut to crack. He said: “We have interest from Phoenix, Arizona, with a company that would like 17 machines. We are unable to supply that amount quite yet. We’re working with a lot of great people. SFU [Simon Fraser University] are great, we really want UBC [the University of British Columbia] on board, which will hopefully happen soon. We have a lot of great apartment owners, really big ones including Realstar, and another that owns five apartment buildings here in Vancouver.”
Success so far has been mixed, and is very much linked to the nature of a building and resident turnover. Andy says the sales pitch to building owners is easy: “This will give you revenue share, you’ll be doing something good, and if you don’t like it we can take it out in one month. There’s absolutely no risk.
“But the consumer side is more difficult. We have to work with the building manager who can tell us where we can or can’t promote. In one building, for example, we are not allowed to put a poster in the elevator. So in some buildings, especially those with short-term rentals, it’s tough, but in other buildings where we have liberty to promote it’s going great.”
Now barriers are being broken down in targeting the US, Andy believes his company is well placed to succeed in the States. “In downtown cores the US is notorious for being spread out… Things being close is at a premium in the United States. And campuses in university towns are usually very, very expensive because there is not much else around there.”
The States, says Andy, is their target, not because it’s bigger, but because it fits their model better. By this he means there is less choice nearby, and the choice there is will be more expensive.
Another target is grocery stores in BC. All the local players—Nesters, Choices, Urban Fare, Save On Foods—are now owned by one person: Jim Pattison. Consolidation on this level, if nothing else, makes pitching easier.
Soapstand seems well placed to grow in 2018 and beyond, based on Andy’s understanding of consumer psychology alone. Every environmentalist is a consumer but not every consumer is an environmentalist. Changing attitudes and behaviour is a monumental task. It’s far smarter to effect change by positioning an environmentally conscious business as easier, cheaper and more convenient to use.