Market Overview

How A Cupcake Company Used 'Shark Tank' And Technology To Sweeten Its Deals

Share:
How A Cupcake Company Used 'Shark Tank' And Technology To Sweeten Its Deals
Related IBM
Humana, IBM, United Continental, Verizon: 'Fast Money Halftime Report' Final Picks
7 Key Technical Levels To Watch On Monday
A Year in Berkshire Hathaway's Tech Stocks (GuruFocus)

The choice between selling out and staying pure is faced by crust punks and startup entrepreneurs alike. Both diehards and founders, when faced with the prospect of the big time, have to decide whether the money is worth the prospect of giving up some of what made what they did great in the first place.

Or, if you’re Tracey Noonan, CEO of Wicked Good Cupcakes, you can have both. As a baker-turned-baker/entrepreneur of a multimillion dollar company, she focuses on keeping the at-home feel of the cupcakes that catapulted her to “Shark Tank” success and a deal with Kevin O’Leary while scaling the company.

Swimming With The Sharks

“My most important focus is that the customer never be disappointed,” Noonan said in an interview with Benzinga. “It’s one thing to bake two dozen cupcakes at a time in your home kitchen to having to produce thousands and retain that homemade quality and flavor profile. Going from small batch to large batch and making sure everything tasted how we wanted it to was one of the most difficult parts of growing the business.”

It seems to be working—Noonan said that her team fills an order for hundreds of cupcakes to International Business Machines Corp. (NYSE: IBM) the same way they take individual customers’ orders. Wicked Good’s customer service is all on-site, and the company’s first hire—a service rep—still works for the company.

“One of the reasons our customers come to us is because they like the story of a mother and a daughter on ‘Shark Tank,’” said Scott Noonan, Wicked Good’s CFO. “They like that story, and we have an interesting paradigm in that we’re growing and trying to maintain that same family atmosphere and brand integrity to our customers.”

Human Touch

One way Tracey and Scott do that is through a combination of a personal touch and technology, in which the company’s invested in recent years. Interestingly, they note that for an e-commerce company, a large portion of Wicked Good’s customers want to place orders via phone.

“We underestimated how important the human interaction experience was in the early days, which is why we don’t outsource our service,” Scott Noonan said. “But for me, as a tech person, I shy away from a lot of technology because it’s easy to over-technologize. We have two criteria for adopting tech: does the technology make it easier for the customer and does it help the internal efficiency of the company?”

Custom Made

To suit those needs, he said, most of the company’s tech is custom made. Its primary focus is ease of use on its website. For example, early on, the company found that most of its customers are ordering the cupcakes as a gift and need them to arrive somewhere on a particular date. Traditional e-commerce shipping options, which give a range of arrival dates, weren’t going to cut it for those needs.

“What we decided to do was give customers the choice of what day they want their cupcakes to arrive, and the website will show the associated cost to get it there on that particular day,” Noonan said. “That was a real game-changer for us in those days, because many companies weren’t offering that service. When we look at technology, we use it to solve a real problem our customers have.”

Follow The Journey

The other area in which the Noonans have invested is data analytics and the customer journey. Scott Noonan claims Wicked Good’s raw conversion rate on its site is nearly 10 percent, compared to e-commerce averages of less than half that. Fewer than half of potential customers click off the site without buying once they’ve put something in their cart. A recent industry metastudy found that nearly 70 percent of online shoppers abandon carts.

Despite the upgrades, the core of the company is its cupcakes and the human touch.

“We got an email from a young girl whose grandfather had just passed away, and she told us that she would take weekly trips to one of our locations with him to get our cupcakes, and that was how they bonded,” Tracey Noonan said. “That kind of story puts what our product is used for in perspective.”

Photo credit: Wicked Good Cupcakes

Posted-In: ecommerceEntrepreneurship Top Stories Success Stories Be Your Own Boss Exclusives Interview General Best of Benzinga

 

Related Articles (IBM)

View Comments and Join the Discussion!