model, and what they’ve got planned next. Inside Retail: What led you to launch Pleasant State? Can you tell me about the vision and idea behind the brand? Ami Bateman: In late 2019, I was suffering from chronic headaches daily, which were really debilitating. I’d been working with healthcare professionals to determine the root cause, and we landed on the idea that my home environment was quite toxic, so I had to go through a journey of eradicating [toxic things]. But when it came to cleaning products, there was no effective, healthy or sustainable solution on the market. I came across ‘just add water’ cleaning solutions, and I thought it was a genius idea. Our cleaning products are predominantly made of water, and we just transport them around the country contributing to greenhouse-gas emissions, but the other ingredients are full of toxins. Just add water solutions had existed in the commercial space for many years, but they hadn’t been packaged up in a beautiful direct-to-consumer way. I saw this as an opportunity that didn’t exist in Australia. I thought, ‘I’m going to make it, and I’ll make it really effective, really beautiful and non-toxic.’ I also wanted to build a business that could prove that doing good is good for business along the way. I just needed someone who could bring a brand to life, a brand that our customers would really love, and that would inspire them to make small changes daily to create a better world. That’s when I was introduced to Sian. Sian Murray: We met at a cafe on the Sunshine Coast, and when Ami shared her wild idea to rid the world if plastic and toxic cleaning chemicals, within minutes, I was in. My background is in digital marketing. I’m originally from Melbourne and relocated to the Sunshine Coast to be closer to the ocean, which I’m really passionate about, so I came at it from more of an activism side. I was concerned about the plastic issue and keen to use my branding and marketing skills to work on things that actually have an impact on people and the planet. When Ami shared her idea with me, I was really excited to get involved, and then it just snowballed from there. Pleasant State co-founders Ami Bateman (l) and Sian Murray (r). Source: Supplied IR: I think it’s interesting that you didn’t know each other before starting Pleasant State. Did you have a sense that you would work well together? The relationship between co-founders can make or break a business. AB: From my perspective, I knew that I had the skills to build the business – the HR, financials, you name it, I could do all of that, I just couldn’t do the marketing bit. It wasn’t an area that I felt I had the talent in. And the brand that I envisaged, which was really hopeful and optimistic and fun and accessible, I didn’t necessarily see those traits in myself, so I knew I had to bring that from someone else. I also knew that person would be really different to me. I did my MBA at Melbourne Business School, and my background is in professional services, so I’ve learned how to manage differences in working style. You can have healthy conflict, and you can manage diversity, if you make it really inclusive. As long as we were really aligned to what we were trying to achieve, which was building a better business that impacted positively on people and the planet – that was most important. There’s a concept I learned at Ernst & Young about social styles, and our styles are diametrically opposed. Sian is people-focused and a creative person, whereas I’m fast and task-focused. I was always conscious that we had to manage that in a healthy way, and we’ve done that effectively. SM: From my point of view, it’s definitely been a big journey together. I often joke that starting a business with someone is like marrying someone. When we initially started working on Pleasant State, I wasn’t sure exactly where it was going. We were investigating it and then Covid happened, and both of us decided then and there to go all in. Throughout this journey, we’ve learned so much about each other, but I think the fact that we are so different is one of the reasons Pleasant State has been so successful. IR: What was it like to start your business during Covid? Were there any silver linings to launching a new brand at a time of so much change and uncertainty? AB: We incorporated Pleasant State on 17 February 2020, a few weeks before Australia went into lockdown. At that stage, we were still investigating the idea to see if it was something we were interested in. When Covid hit and everyone started dialling back and cutting budgets, that’s when we went full throttle. I recognised that we could play a really important role in creating jobs not just for ourselves, but also for people in our local community, and help stimulate the economy, including helping support manufacturing in Australia, which, at the time, was not in a good place. There was about a two-week period when a lot of people were losing work, or their roles were being cut back, so we were able to access really incredible talent. For example, Ranil Illesinghe has been involved from the get-go in our business. He’s really senior in customer insights at Vicinity Centres, but was cut back to two or three days, so we were able to get him to do a customer insight research project, where we could interrogate the Australian community. We spent up to 20 hours speaking with consumers who were environmentally oriented, to understand what their life looked like, how their behaviours were going to change [during Covid], what they were doing from an environmental perspective, and what interest they had in our idea, so we knew before we even launched that we were onto a winning idea and a winning brand, which was super exciting, and really de-risked the process. Source: Supplied The other thing is that we launched an e-commerce brand at a time when people weren’t buying in retail, so that really helped. And if there was ever a time when people needed effective, healthy and sustainable cleaning products, that time was during Covid, so that was a benefit. The biggest factor was the community-building work we did. We launched the brand before we had a product – that was a deliberate strategy using lean start-up principles. Sian worked really hard with our marketing strategy to build a database, which led to our crowdfunding campaign, so we were able to get 1500 people to pre-order our product, which helped fund our first 20,000 glass bottles. That process of building community, getting feedback on everything we do, is a formula that we continue to use in every stage of our business, and it’s proven to be really effective for us. IR: I know it’s hard for a new brand to build awareness and reach customers, but it’s especially tough when you’re bringing a new concept to market, like Pleasant State is doing. How did you manage to get those first 1500 people on board? SM: The market research we did prior to launch was really important. One of the things we learned from that research was that there was a disconnect between the conscious consumer and the products they were using to clean their homes. A lot of these people would be using a KeepCup and cutting back on plastic, but when it came to their cleaning products, they hadn’t really thought about it and were just using the products that their parents used. There was brand loyalty in that sense, but it was because they hadn’t really considered it. There was also this idea that natural products didn’t perform as well, so we learned that our products definitely needed to work if we were going to change customer behaviour. In terms of getting people to make the switch and growing that community, we wanted to change our customers’ relationship with cleaning. So instead of being something that people avoided, a product that was hidden under the kitchen sink, we wanted to make cleaning pleasant. That’s why we put so much energy into building the brand and working on our design, making sure our bottles were really beautiful. We wanted them to be products that people displayed on their kitchen bench and shared photos of on social media. The branding and product design were really important early on, and we invested a lot in that. For us, it was also about bringing consumers along on the journey, so we launched our socials first, before we ran the crowdfunding campaign. There was a lot of us talking to camera, saying, ‘We’re building this; our mission is to prove that doing good is good business; we’re ridding the world of single-use plastic and toxic cleaning products, can you help us?’ We also ran Facebook ads to drive that lead generation. Our whole objective was building that database, and then once we had that audience, we constantly kept them updated, and they gave us feedback as well. It’s about building a relatable brand that customers feel like they’re a part of. AB: One other thing is that, in our analysis around brand positioning, we found one brand in particular really owned effectiveness, so we made a decision that we would never go out and say, ‘We’re the most effective.’ The brand that held that position had been in the market for decades and decades and had a lot of budget, so we would always say, ‘We’re just as effective as mainstream brands.’ The way we prove that is for any new product release, we invite 100 Australians to test our product for free, and we collect data from them and [get] social proof and user-generated content, so we can share that with our community in a really cost-effective way. Source: Supplied IR: Can you explain Pleasant State’s product offering? AB: The typical customer purchases a starter bundle from us, where we bundle the glass bottles with the cleaning bars and cleaning towels and offer a discount. We call that our Partner in Grime bundle. We also have a Clean Slate bundle, which is our multipurpose bathroom and glass cleaner, our hand wash and dish wash. They either come back and purchase cleaning bars as once-off refills, or they can purchase on a subscription, which we incentivise with a 25 per cent discount. That’s proven really effective for us. Last time we checked, just over 17 per cent of our active customers were current subscribers. And any time we’ve seen a downturn in spending, that subscription model continues to provide us with recurring revenue, which is really helpful for us as a small business. SM: The feedback we get from customers is that the subscription model is super convenient for them, particularly the segment that we’re targeting, which is the younger generations that are quite comfortable shopping online. They can just set it up and forget about it, and then it arrives on schedule. AB: We have a 40 per cent customer return rate, from the first order to second order, which, based on our research, is really high for e-commerce. What’s more interesting is that the return rate between the 12th and 13th order is around 83 per cent. So once the customers do come back, they stay with us, which again, is testament to the product. Having said all that, we know that retail is a really important part of our strategy. E-commerce has served us really well. Through Covid, it was an effective way to get ourbusiness and brand out into the world, but the data has shown that people are and will continue to purchase through retail stores. Our first formal adviser is Wendy Rattray, she’s the former CFO at Unilever and headed up their home care division, and she’s come on board to help us with our retail strategy. Now that we’ve raised money, our first hire will be someone quite comfortable with retail.We have a good opportunity to get out there and demonstrate to mainstream consumers that Pleasant State is a really viable alternative. IR: Speaking of which, you just completed a $1.1 million raise through Birchal, an equity crowdfunding platform. How do you plan to use the funds? What’s next for Pleasant State? AB: We actually secured about $327,000 in advance, so that takes us to approximately $1.4 million. We have plans for brand awareness campaigns and continued brand collaborations – we’ve already worked with the likes of Mirvac and Dyson, but we really want to take that to the next level, and get the Pleasant State brand out there. We have plans to make our approach to scent more sophisticated, so that we’re actually adding benefits into the home and the experience of cleaning. Another part is working on packaging, and getting that ready for retail. I can’t say too much about what that looks like yet, but that’s a very big focus. And then, there’s our global strategy. We set out to be a global brand from the get-go and we trademarked the Pleasant State mark in nine jurisdictions globally. We’ve already done quite a bit of desktop analysis to understand where our customers are across the globe. When we look at customer segments, it comes as no surprise that the US comes up as number one. The second is the UK. And the third is South Korea.