Today we are joined by Kat Donatello, founder of Austin and Kat, 100% natural dog treats and oils infused with naturally occurring CBD sources from US-grown hemp in Colorado. In this episode, you’ll hear how Kat harnessed her passion for health and wellness to not only answer a real problem for her family, but imagine a better future for four-legged best friends across the globe.

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“In 2015, I started to do some testing with friends and I was like, alright, I can do this. I’m an entrepreneur at heart. I can start something.”

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Evan Faber

I’m Evan Faber. This is Brands with Moxie Sozo. Today we are joined by Kat Donatello, founder of Austin and Kat, 100% natural dog treats and oils infused with naturally occurring CBD sources from US-grown hemp in Colorado. Kat has over 15 years of experience as an athlete and a business leader in the endurance sport industry, and made this pivot to pet wellness. In 2014, Kat created this all-natural set of products that would help her dog with her health, well-being and various ailments. Kat, we’re thrilled to have you on, thank you for being here.

Kat Donatello

Thank you for having me, Evan, I’m thrilled to be a part of the Moxie Sozo team.

Evan Faber

We’ve been working together since Spring of 2019, when you came to us initially for brand development, and we’ve worked on strategy and packaging and website and trade shows and a lot since then, which is fantastic. Before we dive into Austin and Kat specifically, companies are built to serve a human need, successful ones serve a human need, and in this case that human need is around the care for their pets. And so before we talk about Austin and Kat, I would love to hear your take on the relationship between pet owners and their animals, and have you noticed any changes in the relationship between pet owners and their animals over the last few years.

Kat Donatello

I would say over the last 20 years, the relationship that people have had with their pets for 20-30 years, right? The relationship that people have with their pets, is vastly different than it was. I think about the pets that I had as a kid, and it was the cat, it was the dog. And now we’re actually choosing where we live, what car we buy, where we’re going to go on vacation, (when we GET to go on vacation) what hike we’re gonna do, what beach we’re gonna go to, because we have a pet. So many things that we do now revolve around that additional family member. And as that’s changed over the last few years, and I’ve watched it even changing in the four-five years I’ve been doing this, it’s evolving, and you get to see companies really making pivots and making changes because consumers are now wanting the same things that they want for themselves: good organic, holistic diets, quality products, good grooming for their pets, just like they want for themselves. So it’s been a really cool evolution. When I got involved in the space, I knew that I wanted to help my pets. What I didn’t realize, was I was really going to be helping families. That’s been the most rewarding thing that’s come out of this experience.

Evan Faber

Yes, the idea of a pet moving from a companion to a family member has been a big shift. And we’re seeing the changes, as you mentioned. It’s almost a question of who owns who, at what point, as you’re making so many different decisions, but pets almost as children, in a lot of ways. Rewarding and also extremely challenging. It’s not just the blissful companionship anymore. People are really investing their emotional being in the development of their dogs.

Kat Donatello

Well, and not only investing in that emotional well-being but it’s also becoming something (during this time, specifically) of a comfort, right? I think of all of those people who might be living alone. Whether they’re millennials or they’re my parents age, having a pet be that companion during the time that we’re in lockdown, we’re not having the ability to go out and hang out with our friends like we had previously. Our pets are really becoming that additional family member that for some of us, we’re finding solace and enjoyment and compassion and companionship.

Evan Faber

And empathy I’d add empathy. I think we’re gaining a new level of empathy with what the pet experience is all about, as well.

Kat Donatello

And maybe some patience, wouldn’t that be a great thing? I actually, I know, I shouldn’t talk politics, but I did see a really cool Joe Biden ad last night, and it was showing all of the pets that had been in the White House and I look back and as a kid, I can remember those dogs that those presidents had, and whatever political party they were with, they still had this dog and you could see these relationships with them. So it’s such an important part of the family. I’ve never not had a four-legged friend in the house. Right now we’ve got 12 legs in this house. So there’s lots of furry activity going on here. But I can’t imagine not having that companion by my side, it’s really rewarding.

Evan Faber

I love that no matter who is in office, you remember the dog, so it’s a good reminder to make sure that unity isn’t just for the dogs. All of that background being said, how did you translate these insights and this wisdom into the creation of Austin and Kat?

Kat Donatello

I wish I could say it was wisdom. Sometimes you just stumble into the right thing. I was wrapping my career as a race director, I had been putting on triathlon festival in Maine for 10 years. I made a deal with myself that when my youngest daughter was going to graduate from high school, I was going to turn my race over to someone else. And I was fortunate enough to pass it on to someone else in my community. But I needed to do something at that time. And so about two years before I wrapped up with my races called Pumpkinman, Tim, my husband, had been at a cannabis conference. And so this is 2014. I mean, in terms of CBD, that’s a long time ago, right? That’s in the dark ages. He had been at this cannabis conference and called me up super excited and said, hey, I’m here to learn about THC, but everyone’s talking about CBD. And what the heck is CBD? I had an aging dog and at the time, he was really, really struggling, he was 12 years old. And I didn’t want to go down that medical route. I was living a very holistic and all-natural life myself, as a pretty high-level athlete. I couldn’t imagine supplementing my dog differently than I was supplementing myself. So, when Tim started to talk about CBD and the effects that it possibly could have on helping Brady reduce inflammation and reduce some of the pain and help him regain his connection back with our family, because we see so many older dogs retreating to their own space, they don’t feel well, so they kind of bury themselves off on their own.

So long story short, I was able to source some CBD, we had experience based on Tim’s knowledge of how to incorporate a cannabis product into an edible format. After months of baking and burnt cookies and lots of iterations, I came up with a treat that Brady would eat. Within an hour, I mean, it was really that quick, I saw a remarkable change in his attitude and his mobility. And it repeated itself over and over again. So I didn’t start out to create this as a business. I started this to help my own dog. And I had another dog at the time, a puppy called Austin. Austin is a Labrador Retriever. Anyone who’s had a lab know that they’re high energy. They require a lot of discipline and a lot of training. I had a really hard time with Austin (I had a lot of years of experience with dogs and never had a dog like Austin). So I gave Austin one of those treats on a whim and it just brought him down, dialed him down from being like a 15 on a 1-10 scale to a manageable 9. And I was able to use it in this training, helped him focus, and he’s the wonderful dog he is today. Brady stuck around for about two more years, he had a good quality of life. We used CBD for end-of-life care for him and it was remarkable. Austin continued to thrive. I like to say he’s probably the most CBD’d dog in America. He gets to try every product that we create. And then in 2015, I started to do some testing with friends and I was like, alright, I can do this. I’m an entrepreneur at heart. I can start something. And you mentioned that we started working together in 2019. In 2016, I came to your offices with Tim and we were meeting with Leif, and I said, “Oh my gosh, someday these guys are gonna be my designers.” And here we are. So it was meant to be.

Evan Faber

Oh, that’s incredible. And this brand is at the heart of one of the brands that we absolutely love working on because it’s an exciting space and you’re doing some incredible things. You’ve introduced so many different topics. First of all, we could have a whole separate conversation about how to train wild dogs. I need to follow up with you afterwards because I need a few tips (asking for a friend). But CBD for pets: CBD on its own has been trying to create demand and trying to educate and inform people, CBD for pets, do you think that it’s an easier jump to make or a harder jump to make? What were people’s reactions when you introduced the concept to them?

Kat Donatello

What’s really neat is proof is in the pudding. So if I give you CBD and I give my dog CBD, the power of suggestion with you is awesome. Like I can tell you all of these wonderful things that can happen. And for the most part, that will happen with CBD for you, right? I can lay that foundation. With a dog, there’s no placebo effect. I give him the treat, or I give him the tincture, and I wait the specific amount of time. I’m going to see a result whether that dog is a little more pep in his step, a little bit more energy or you can see him not feeling so achy. So I think the jump for pets is a lot easier than for people. I mean, it’s not a place to obviously be experimenting on our pets, but pets get such good results, their endocannabinoid system, which is what works with CBD, so the CBD goes into that part of our body, that’s the body that regulates things, it just works very efficiently. I’ve always said (I have no scientific proof for this) but we have all of these outside influences on our body: we drink coffee, we have a glass of wine, a big steak dinner and maybe french fries. Well, a dog’s life is pretty simple. They’re eating good quality food, it’s consistent, it’s repeatable, it’s the same, and you introduce something like CBD to their body, it’s going to work. I would say that we have a success rate of about 99%. You get that one or two dogs and a month that we’ll hear it’s not working, and I’ll have a consult with the customer or one of our staff will have consult with the customer and we usually can figure out why it’s not working. But for the most part, dogs get really really good results with CBD. As do cats and horses, for example. They just do very well with it.

Evan Faber

Awesome. So touching upon CBD for pets specifically, in terms of getting over any concerns that people have in terms of the right dose, weight matters, age or breed, I’m not sure, but I would love your thoughts on how you know you’re giving your pet the right amount of CBD and what’s the best format that you’ve seen success with?

Kat Donatello

Yeah, that’s a great question. First, I want to clarify that the CBD that we use in our products is all derived from hemp. And we have partnered with an amazing supplier based in Colorado that provides us with our input ingredient. Our cannabinoids, which is CBD along with other cannabinoids that are really beneficial to pets. CBG CBN, CBC terpenes. The reason we’ve partnered with them, is they have a proprietary process that removes the delta-nine THC out of the input ingredient and that delta-nine THC is what causes a psychoactive effect. So that high feel if you were having cannabis, so we use a what’s called a broad spectrum, still very full in all of the other cannabinoids and terpenes. But we have a very strong stance that THC has no business being in a pet’s body. They react differently. They have a different endocannabinoid system than we do. And there hasn’t been enough long-term studies on on what the effects are. So we want to make sure that we’re not introducing that. So I wanted to just clarify that. You know, again, because there’s not been a lot of studies on it, in my early years, we were very conservative on how we were approaching pets.

So we had come to this one milligram for every 10 pounds of dog weight was a starting place, and you’d go up or down based on the condition or the outside influence. So for example, Fourth of July, you’ve got very reactionary dogs to fireworks. I mean, if someone shot a gun off behind my head and I heard this loud explosion that I didn’t have an understanding of, I’m gonna run for the covers too, right! So during that time, or thunderstorms, reactionary things, you may require more and it’s a bit of trial and error. So we ask people to try and be very consistent with the usage. So if you’re using it on an everyday basis, you’re using it the same way every day. One of the things that I encourage people to do is NOT give it with a meal. We want it to be absorbed into the body quickly. Using a tincture, you’re going to have that happen the fastest and we use a fat-soluble carrier, so like a hemp oil or coconut oil, which can help absorption. And then with a treat format, treats are fantastic because it’s a relationship that you have with your pet. But they take a little bit longer to work. So I’m a strong proponent of tinctures. I use all tinctures with all three of my dogs, they get one of them. We have eight different variations of products in tinctures. So depending on which dog, I’ve got a five-month-old, eight-year-old and a six-year-old, they all get different products.

Evan Faber

Awesome, Bailey, Austin, Harper.

Kat Donatello

Yeah, very good.

Evan Faber

Great. Thinking about CBD for pets, we have a lot of brands that are trying to create new spaces and create demand, and what was your approach to creating demand around this new space and category?

Kat Donatello

I think, for us, we needed to be innovative, right from the start. I didn’t ever want to be playing against my competitors, I wanted to play on a different playing field altogether. So really thinking about overall wellness, and not just about fixing a problem right now. Kind of like, you go to the dentist, not just when you’ve got a toothache, but you go for preventative care. It’s the same kind of approach, we wanted to look at long-term health rather than just quick fixes. And I think that if you have a pet that needs a quick fix, then you probably need to be going to your veterinarian. But if we’re talking about problems that the dog has had for a long time, looking at preventing problems in the future, that’s the avenue I wanted to go down. Now, of course, you’ve got acute injuries that you would be using CBD to help with the recovery. But I think that starting early, that’s one of the things asked “when can I start with my puppy, when can I start with my puppy?” You obviously want your puppy to be a puppy first, right? And lots of people have gotten puppies during COVID. There’s a time and a place to introduce CBD to that puppies’ regimen. So it can help with training. I mean, they throw their bodies. I forgot like having a five-month-old puppy, I forgot what they can do to their bodies. They’re contortionists! They’re gonna feel achy and sore, just like you would feel achy and sore if you were doing somersaults all over the backyard.

Evan Faber

Yes, and true. Looking to not take competition head-on, looking to the term that’s been used often is “finding blue ocean,” the place where other people aren’t competing and trying to find that white space in the category and that’s fantastic. So you started there…has competition moved in? Do you find that they’re trying to compete in some of the same ways? Are you having to stand-out differently or use different strategies and tactics than when you first started?

Kat Donatello

Yeah, I have. When we came to you, we had this classic line, very simple ingredients, things that you would have in your own kitchen at home. In fact, I started baking them at home. So it was all things that I could source right at the house. But as the company grew up, we knew that we needed to do things that were different. So we came to you when we were launching our functional lines. The functional lines, what they did, was they incorporated other herbs, botanicals and adaptogens in really good amounts, efficacious amounts, that would see a benefit to the pet. And those other ingredients, like CBD is awesome, right? But when you can give it a complimentary ingredient, you almost supersize the effects of it. Now that’s only going to work if you’re actually using the right amounts. And that was something that was really important to me that I wanted to not just say, oh there’s tumeric in the product, or there’s glucosamine in the product, I really wanted to make it a high-quality product with really really good ingredients. Ingredients matter, and I didn’t want it to just be eye candy on the label. I wanted it to make a difference.

So the products that we’ve created with our functional line and we have four need-state biscuits, we have four need-state tinctures. They’re all addressing very specific needs that a pet may have with those adaptogens and botanicals that if I just gave those adaptogens and botanicals alone would be great. And then when you add the hemp, primarily CBD, but these other cannabinoids and these other terpenes, you’re really elevating the result that you’re going to get. So if you’ve got a dog dealing with severe anxiety, separation anxiety, thunderstorms, fireworks, you add these botanicals like lavender and chamomile, we we source a chamomile from Germany, and it’s grown naturally. It’s not sourced and grown in some greenhouse, but it’s grown in its natural habitat. That’s what you want to have put in. We keep saying ingredients matter, ingredients matter, ingredients matter. Those input ingredients, it couldn’t be more important to be sourcing things that are grown naturally. And then you’re just going to have a much better product. And if that means it costs me a little bit more, so be it. I know it’s the product that I’m giving to my pet. So I want it to be the best thing out there.

Evan Faber

Totally. And I just as you’re talking about these Germanic lavender fields, like I would like some of that. I mean, regardless of pet, it could be for a human. It’s a challenge with ingredients and communication, at least from my perspective, maybe it has or hasn’t been from yours. But I feel like in certain categories, and maybe it’s different in this one. But in certain categories, you have conventional food companies, natural food companies, everyone’s talking about the best ingredients, quality ingredients, and they’re all delivering on it at different levels. Wondering, from the consumer-standpoint, what words really hit, just like quality ingredients, or natural ingredients, those words have been co-opted by companies that might not be as ethically-driven as you are. So is it a straight communication to the consumer? Or how are you signaling to the consumer that this is the real deal?

Kat Donatello

Transparency is key, right? You keep hearing this terminology in the CBD industry is triple-party-tested, everybody’s triple-party-tested, right? I think you should be fully traceable, from the minute that product comes in. So yes, our products are triple-party-tested. But what about the other ingredients? Can you trace their pathway to my kitchen? And I think that’s really important. We’re in the process right now of uploading all of that stuff to our website. So you’ll be able to look at where that chamomile came from, or where the ashwagandha root came from. And that’s really important to me, I want to just be able to lay it all out there for our customers. And I want our retailers, especially, to have confidence in us to know that what I’m saying is the real deal.

Over the last year, we’ve been very fortunate. And we brought on a former scientist from the Mayo Clinic to our staff. And it’s been a huge unlock for us. If anyone ever wants to nerd-out on science, call the office and I’ll put you through to Matthew. But that’s been a huge, huge unlock for us. Honestly, I didn’t come from the pet industry before, this is all new to me. I didn’t come from food and beverage. I didn’t know there’s all these different levels (I’m going to keep using chamomile, you know, as our other topic) but I didn’t know that there were all these different levels of that. And Matthew is like, we need this very specific German chamomile, we need this very specific mushroom that’s grown in Butan, and it’s grown naturally. I’m like, “Okay, how much more is this gonna cost me?” And he’s like, it doesn’t matter! We have to make the very best product that we can. I’m like, you know what, you’re right. That’s our egos. I’m feeding this stuff to my pets and I’m hyper vigilant on what goes in their bodies. So that’s what’s going to go in my products.

Evan Faber

You take it one step further from a brand perspective, at least again, from my point of view, in that you show up on your different social channels as yourself. You put yourself out there, you show your vulnerability, you tell your stories. That is showing transparency versus just saying we’re transparent and just putting it into the product itself. You can have a transparent product, but you also have to have a transparent brand. One of the mantras we talk about is show don’t tell. Once you’ve nailed your strategy, once you’ve nailed what you’re going to own, great! Now pretend you can never say those words to the public. How are you going to demonstrate it? How are you going to show up for people? And you do that. You embody transparency by the way that you as the founder, show up, talk to people, are engaging, you exude authenticity, and give people a window into your life. That goes a very long way, where you don’t have to hammer a literal transparent messenger, you do it by the traceability, you do it by how you show up. So at the brand, and the product level both need to be aligned and you do a great job of that.

Kat Donatello

Thank you, that’s really nice.

Evan Faber

Absolutely. The other thing you talked about was innovation. Innovation has been a hallmark you said, even when it was, when you were first starting out, how do you want to differentiate yourself, even the answer went back to innovation, we want to do something new. And you have the classic line, the functional line, and biscuits and oils. Up to now, and we’ll look to the future in a second, but up to now, what drove your innovation and the products that you kept the products that you cut, the products that you created up to this point? What drove that?

Kat Donatello

Honestly, I think a lot of the innovation has come from my need for my own dogs. I mean, you guys haven’t met Austin. He’s the hero brand in the functional line is Austin’s Active, right? He is the most active dog I’ve ever known. And people will say no, no, no, I’ve got an active dog. This is a dog who, when I am marathon training, will run 20 miles with me and then be ready to go the next morning. And I would make sure that he was getting treated the same way I was. I’m doing an ice bath and I’m taking tumeric and I’m doing massage, and what am I doing for my dog? How do I make sure that he’s recovering the same way I am. And so that’s kind of where the birth of the functional line came. So we have this classic line that was a great introduction to CBD, it’s a great wellness product, it’s still our number one product. But I needed to start addressing these needs.

And then I had Bailey, our English Springer, and he’s, I don’t want to use the word neurotic, but he’s a nervous Nellie. The doorbell rings, a firework goes off, a dump truck backs up, a man with a hat causes barking. Don’t wear a hat my house, right? So I needed to create something that could just help him relax. And then I had a senior dog. And my best friend Elizabeth, is in Maine, she was one of our very first customers and she’s got these giant Bernese Mountain dogs that have always struggled with hip issues. So I’m like, I’ll make a product for you. So really, I did it because I wanted to help people. I’m going to go back to my Pumpkinman days, our race that we had was really unique and really different. And I never wanted to follow in the footsteps of you know (IRONMAN is great I’ve done a bazillion of them) I didn’t want to just be a cookie-cutter race. I wanted to do things really different and set myself aside. What did I want as a racer, when I finished the half IRONMAN? I didn’t want a slice of pizza. I wanted real food. So we had a sit-down turkey dinner, sit-down Thanksgiving dinner, with all the fixings, right? Because that’s what I wanted. So I kind of just keep doing those kinds of things. Like, people say, What is your Why? Why are you doing it? I think about what do I need? And how can I then pass that on and share it with others. And I think that’s really where our innovation comes from. And then it helps that I’m married to Tim Moxie, the founder of Nuun. He needed a better drink than Gatorade when he was training for IRONMAN. So he formulated Nuun. I think that’s just in our blood. We’ve got to solve a problem. And other people have that same problem, so why not share it?

Evan Faber

Nice. And it goes back to a word that came up earlier, which was empathy that your innovation was driven by empathy, seeing the world through the heart and mind of your pet. Empathy is probably one of the most prized possessions a business can have. Empathy towards its people, empathy towards the people it serves, using empathy as a lens through which to make decisions and to gut-check decisions, it is a powerful force that should be taught to people in school just like we teach communication, because it helps us connect with our needs and other people’s needs and how we can best serve each other. And so as you’re creating products that came out of your own empathic relationship, it’s just an important term for for brands and companies to embrace. As you look towards the future of the CBD pet space, what will drive your innovation?

Kat Donatello

Mmm. Yeah, that’s a good question. Honestly, we’re looking to do complementary products. And you’ll be seeing that come from us in 2021. We’ll be creating products that don’t have CBD in them. But that will be incredibly beneficial as part of this holistic supplemental lifestyle that you’re incorporating into your pet. So that’s what we’re going to be doing. And we’re going to be tweaking some of the products that we have right now. Our classic lines getting up pretty big tweak for a January first launch. So that’s been going on behind the scenes. And then we’ve got a super-uber top secret project that will be coming out with very shortly that I’m beyond excited about.

Evan Faber

Okay, I will not ask further but excited as well.

Kat Donatello

Yeah, it’s something that Tim and I and Matthew have been brewing in our brains for about six months. And it’s starting to come to fruition now, we just built a new lab. And so we’ve taken a lot of production back in-house. For many reasons, one of them being COVID, supply chains are very difficult right now, but having the ability to kind of do some very, very creative, incredibly innovative things that that no one’s doing in the space, right now is going to be an opportunity for us to really make a big impact on a lot of pets lives. And, and first and foremost, that’s what it’s about. It’s about impacting these pets lives. We talk about different things in the office, and it’s never about who the owner is. When we first start talking about it, yes, the owners are incredibly impacted by however their pets being affected, whether it’s pain or anxiety, but the first thing always is going to be how can we help that pet. We’ve had a lot of initiatives and make sure that we’re focusing on that. And that’s when you then get that broader, like, okay, now we’ve helped that family, now they can go on vacation and not freak out that their dog’s gonna lose its mind boarding or whatever. So it’s been really good.

Evan Faber

Awesome. You brought up COVID. And I don’t know whether this is COVID-related or not. But, uh, I know that you’re seeing success with subscription, the subscription model, and so many brands are trying to crack that nut, how do we get people to sign up for subscription services? And so, what makes a good subscription service? Versus one that’s not great?

Kat Donatello

Yeah, I think having that consistent relationship with a customer, and having that communication and that back and forth, and really learning about that pet. Because if you’ve gone on a subscription program with us, we’re probably going to be with you for the life of your pet, as long as the products continue to work, and for the most part they do. But having that consistent conversation, so doing the check-ins with them after a certain amount of orders, giving them gifts after certain amount of orders, and again, really knowing their pet. And Becky, who runs our customer service department, she can tell you stories about almost every dog that’s on our subscription platform, which is great. It’s about 50% of our online business. The unboxing experience, the education that we’re providing for them. It’s not just open the box every time and out comes my oil. There’s something curated in there every time and we still handwrite cards. It takes a lot of time. But you know, it’s important that we do that because we want we want to have that feedback, back and forth, and we want to know what’s working, what’s not working. What do you need? I mean, if Elizabeth had not kept pushing me about Paco and his hips, I’m not so sure I would have gone down the Get Up and Go formula. Right? So she kept telling me, I need this, I need this.

Okay, we need this, we’ve got to create this. So knowing what our customers are needing and wanting, that’s one of the first things we talk to retailers about with our functional line is, consumers are going into retailers. And they’re saying, I need CBD. And then the retailer says to them, Well, what do you need CBD for? Oh, my dog is super anxious. Oh, my dog is, you know, 12 years old and struggling with old age. Well, now we’ve given them products that very specifically address those needs. And it gives that opportunity for the retailer then to also establish a really good rapport and relationship with their customer. Because they’re not just saying, oh, here’s some CBD, they’re actually able to say, here’s a senior product, it’s got these particular ingredients in it, this ingredient helps with ocular health. This ingredient helps with brain health. I mean, dogs go through some of those similar things that senior people do. So they can have dementia-like things happening to them. So we’ve incorporated ingredients that will address those needs. But being able to have that conversation and learn about your your pet’s specific needs is really a win-win for everybody.

Evan Faber

It’s such a good point. I do hear from some brands, when we ask why are you wanting to get that subscription service, their eyes light up at the prospect of having some sort of passive-ish income, but you bring up the one of a couple pillars that make a subscription service. So powerful, and one is continued active engagement, not treating it like a passive revenue stream. But continuing to personalize the offering and to allow the consumer to engage and explore new things with the brand is crucial. The other one that came up in this conversation is how you keep adding value, how you keep proving the value of the product and the service, so that they perceive it, and they never questioned it. And the last piece to combat subscription fatigue is how do you keep things fresh? So keeping things fresh, continually proving value, and continuing active engagement with the audience. There’s three takeaways that I heard from you about what could make a subscription service successful.

Kat Donatello

Yeah. And when we introduce new products, our subscription customers will get the new products. We’ll just throw it in their bag, or in their box, and they’ll say Whoa, what’s this? Well, we know you have an old dog, like when we introduce anyone a tincture, that’s what we did, we reached out to a certain number of our subscription customers and said, Hey, we know you have a senior dog, or we know you have a young active dog, we want you to try this, give us feedback, we want to learn from you. And it just allows us to know who our customer is, where our customer lives, how our customer is dealing with their dog, it just gives us so many nuggets of information. And then we can go back and say, okay, we need to do this, this, this and this better, we need to add that to the product. It just helps us so much.

Evan Faber

Awesome. One of the big beliefs we have is break down the wall between the the business and the customer and allow for that exchange, it should be an inspiring process as you’re interacting with your customer to hear about what their needs are, what’s working, how they’re hacking the product to do something you never expected, a great source of innovation, great source of free market research, and a great way to keep your innovation fresh. So that’s so wise to go down that route. Shifting gears a little bit, I want to talk about the effects of COVID but in a broader context, because right now it’s COVID tomorrow, it could be something else. Categories sometimes can face tremendous disruption and upheaval, even when the economy is great. So we can look at this conversation, obviously within the context of COVID. But really, this is about how do you deal with massive business challenges that sort of sweep through and cause you to get into perhaps a reactive or defensive state. Looking at the current environment and again, COVID being what’s affecting us all right now, how did Austin and Kat look at: operations, portfolio, branding, marketing, what did you look at to combat these challenges?

Kat Donatello

Everything. It’s interesting because Tim’s eldest daughter Harriet is applying to college right now, and the college essay has shifted, they’ve added a new prompt: how did you change or navigate this very different time of COVID? What did you do? How did it impact you? And so we started to reflect back on, gosh, how many months has it been? I got off the plane from Global, Global is the big pet trade show which was so beautifully designed (by Moxie Sozo). My absolutely gorgeous trade show booth, which I don’t know when I’ll ever get to use again. But I got off the plane at the end of February. And there were a number of manufacturers that didn’t come. None of the Chinese manufacturers were allowed to come. There was a lot of buzz at the trade show about COVID and what was happening, and this is the end of February, and I get off the plane (we also have accounts based in Seattle). And Tim says to me, we’re going to Costco, and it’s a Sunday. And I’m like, I’m not going to Costco on a Sunday. He’s like, no, we have to stock up, the city’s gonna shut down. And so we were very early on, and we got impacted really quickly when we shut down. Our distributors did not place an order in April. And that was a crushing, crushing blow. And I can remember standing in the parking lot of my office, just sobbing, thinking, oh, my gosh, we’re going to go out of business. I don’t know what we’re going to do. And we got together, the management team. And we said, first off, we’ve got to cut spending. And we’ve got to get really creative.

And so we divided the company into three buckets: a marketing bucket, a sales bucket and an operations bucket. And we did what were called weekly sprints. We followed this book called The Great game of Business. Every week, each of the teams had a sprint. A project for that week. Because we didn’t know what was going to happen in 10 days, but we could kind of manage those seven days, and the sales team, we weren’t selling. So what we did was we got on phones, and we did well-check-ins kind of like a doctor well-checkup. And we called every one of our stores over the course of eight weeks, that’s over 1000 stores and just checked in, we were not selling. How are you doing? How can we support you? Is there anything you need? Do you just want to cry on the phone with us. I mean, we literally we’re having those kinds of conversations. Operations, just redid the whole operations, the way we were running the company, we closed down our 3PL. We brought all shipping back in house, which has been brilliant. And then marketing just went to town: great collateral, redoing all of our email chains through klaviyo, and all of the different email funnels, getting out incredible newsletters, and then we worked on this, at the end of March, we did this amazing “How to survive during COVID with your pet guide.” And we partnered with a bunch of different companies around the country. And we came up with this like 20-page guide on meditation, how to work from home, how to train your new puppy, everyone was adopting a dog. And it just generated all of this great communication with our customers and our retailers. And I would say now, that the relationships that we have with our stores, our distributors, and our customers is, is like nothing we could have imagined. So as horrible as all of this experience has been, I look at it as a complete blessing for our team because it brought us back to being scrappy and having to figure things out. I felt like I was back in 2016. Like it was just me running the company again, because I was doing everything but it gave us all an opportunity to really support one another and support everyone that was supporting us in the past, and I think that we’re stronger than we’ve ever been. And the relationships that we’ve created right now are just absolutely phenomenal.

Evan Faber

Incredible. A couple concepts that came out of that that struck me was this idea of focus, fortify, advance, and you all focused on Okay, let’s get focused, let’s get focused around where our strengths are. Let’s get focused around our challenges. Let’s get focused on a timeframe that makes sense. We we can’t look two weeks out, but we can look seven days out. So let’s get focused around the challenges and the opportunities and the timeframe. Then let’s fortify. From focus to fortify, let’s cut spending. Let’s build defenses that strengthen, not weaken, because you can get into too-defensive of a posture where you’re cutting too much. And that doesn’t allow you to accomplish a third thing, which is once you’ve gained focus, once you’ve fortified, now advance. Look for ways to advance the relationships, you look for ways to advance a relationship with your buyers, look for ways to advance relationships with consumers through marketing. So it really is interesting to hear that that focus, fortify, advance, and just the idea of the sprint is such a powerful one for disruptive moments. You can look at the data between companies that were responsive and nimble before a recession versus the ones that weren’t. And during the recovery period, the post-recession period, as you could imagine, the companies that were nimble, the earliest and the fastest, and were proactive, had the biggest recovery and grew stronger. A lot of companies talk about being nimble, they talk about it, but your ability to say “let’s sprint” is probably one of the reasons that you’ve seen some great success even during these turbulent times. So thank you for that question, or that answer. A couple things as we wrap up, one is a wildcard question. It’s a random question that we ask everybody at the end. And it’s unique to each individual. And it’s sort of off the wall a little bit. You’ve got a new puppy Harper. So the first part of this is what’s her personality like? How is it emerging?

Kat Donatello

Oh my gosh, well, I’m going to grab her then. She is my first female dog. And I have a lot of dogs. She is the happiest dog I have ever had. She has taught me patience. She’s taught me to be a kid again. And she told me to laugh. I have not laughed more since the Fourth of July than I have with this dog. And the other thing that’s it’s given me is Tim has never had a dog completely on his own. So Austin is my dog. Bailey goes back and forth. We have stepchildren so Bailey is not with us 100% of the time. But to watch him (I’m not gonna cry) but to watch him with this puppy, and to see this relationship with her, is amazing. I don’t have children with Tim. So I can only imagine had we met a long, long time ago, what having kids with him would have been like because he’s so awesome with her.

Evan Faber

Well, that’s so cool to hear. That power of a puppy, of a dog. I love what you said about feeling like a kid again. They can awaken things inside of us which are amazing.

Kat Donatello

Oh my gosh, I take her to this field every night after work. And she’s white. I’m gonna grab her. She runs so fast that her skin is actually moving at a different pace than she is. And it’s just so fun to watch. The only noise I can think, if she could make this noise…do you remember the pig in the Geico commercial that was hanging out the car window. It was like “Weeee!!.” That’s the noise that she’s making. I’m gonna grab her because she’s adorable. She’s not the puppy she used to be.

Evan Faber

Oh my gosh! How old? Did you say six months?

Kat Donatello

She’s five months.

Evan Faber

Oh my goodness.

Kat Donatello

She’s like, just such a love. And all the pictures that Charles has drawn her are just, they’re so spot on. She such a little princess with her little pink bows.

Evan Faber

Oh, that’s awesome. So the question for you then, is what dog breed best personifies the Austin and Kat brand.

Kat Donatello

Oh, gosh. I would I’d have to say a lab. We’re just, we’re just a fun loving bunch. And we’re loyal. And what you see is what you get. And that’s such a good question, Evan! I love it. Next month we’re doing a big culture thing. So I have two staff that are in California and they’re gonna fly up and we’re going to spend a day just talking about culture. And I’m gonna ask everybody that (secretly) that’s such a good question. But yeah, I would say that we’re Labrador Retrievers. We’re loyal. We’re honest. What you see is what you get. And yeah, that’s us.

Evan Faber

Super cool. I love it. Well Kat, you’ve shared so much wisdom and insights with us. Thank you and in a way that to honor that the last few seconds here: shameless plug. Tell us about Austin and Kat, where to find it. What sets it apart. Anything you want. The floor is yours to promote how you see fit.

Kat Donatello

Yeah, I’m not that kind of person but AustinAndKat.com. You can find us online. Retailers across the country (if your pet store does not carry Austin and Kat, tell them to contact their distributor). And then we love social media. I actually do the social media for Austin and Kat with my gal Erica in the office and it’s so much fun. I do love to share my story. And so there is a lot of very honest content that’s just from me on there and we share our customers stories and product knowledge but the content for me is…I am an open book and I do like to tell people what’s going on with with all of us.

Evan Faber

That’s the key. What a wonderful thing. Thank you Kat. Very much appreciate the time.

Kat Donatello

Yeah, and thank you to all the Moxie Sozos. We love you all so very much.

Evan Faber

Feeling’s mutual.

Kat Donatello

I can’t come to the Christmas party this year! So sad! Have a virtual Christmas party!

Evan Faber

We’re trying to figure that out. Planning for that has commenced.

Awesome Kat. Be well.

Kat Donatello

Thank you, Evan.