Shownotes
Lighter Charms are an opportunity for you to turn your best-selling lighters in the world into a billboard that you control. Lighter Charms are perfect for lighter identification and self-expression. CEO Rob Healy instructs the user to simply slide the silicone band on your lighter, pop a charm into the charm band and use your lighter as you normally would (For lighting candles. NOT if you’re an arsonist.) You can also use the charm as a ball marker, a fridge magnet – whatever you like. Just don’t eat them or let kids play with them. Just one piece of advice from CEO Rob Healy: If you’re really serious about it, find people who can point out the problems with your product.
Lighter Charms with CEO Rob Healy Decorative Charms For Disposable Lighters That Help You Snuff Your Stuff
We’re incredibly fortunate to have Rob Healy from Lighter Charms as a guest on the show. Rob, welcome to the show.
Thank you very much for having me, Bob.
Tell us a little bit about the business that you have and your journey to this point.
We invented a new product called Lighter Charms. It is a decorative charm for disposable lighters that help you snuff your stuff. The bestselling lighters in the United States are BIC single-color lighters. They’re currently trying to conquer China. They built a factory over there so that will be great. This gives people an opportunity to decorate their lighter however they want. BIC was very smart in they saw how popular their single-color lighters were. They thought people wanted to have a few more options, something that was a little more personable to them, sports teams, that type of thing. They’re fantastic. The only problem is that you can’t change the look of your lighter when you buy it with one of those graphic sleeve wraps.
We thought, “That’s not really as much freedom as we could have,” so we came up with like a wine charm for lighters. You can go ahead and slide it on your lighter. It fits every full-size BIC, as well as Lynn Sliders, Elite, Scripto and several others. It’s a great idea. There were people who were making lighter wraps, but it was very hard to store them. You couldn’t keep them anywhere. Let’s say you have a wrap, you can put it off to the side or in an ashtray or somewhere else. What we wanted to do was make it collectible, so we made them interchangeable. You can now take your charm out of the silicone band. Basically, a silicone band stretches and slides right up your lighter. You pop the charm in and out, based on your mood and you can keep your collection on the fridge or someplace magnetic. What that does is it enables you to collect them, but you can also keep them out of the hands of kids and pets. They’re very small, so they look like candy. It’s a safety feature. BIC is very big on safety and so one of the things that we wanted to do was incorporate that and make sure that was at the forefront as well.
The folks are going like, “You’ve got this charm for the lighter.” Tell us about the journey from, “I think I’m going to do this” to “We’re sitting here now with it done.” Tell us a little bit about yourself and the early years before you started this.
I was always a huge movie fan and so I had decided to move to LA to try and become a movie writer. It didn’t work out exactly the way I thought, but it was a whole lot of fun. I ended up selling a story to Ron Howard and Brian Grazer at Imagine. It was addictive, but it took forever. It took so long to pitch and get through the door and that type of thing. I started looking at advertising agencies, and I had a great opportunity given to me by the owner of the last ad agency that I worked for who took a chance on me, and I ended up working there for nine great years. It was amazing. While I was there, I had open heart surgery. It was very surprising. I did not expect it. Now, when I get excited, I tick. I have a mechanical valve in there and the doctor was like, “Your beer drinking and wine drinking days are over.” I was like, “I’m on blood thinner.” He said, “Yes, you’re on blood thinner.” I said, “That’s that.”
Lighter Charms: The bestselling lighters in the United States are BIC single-color lighters.
As I was home, I was wondering, “Is cannabis a possibility? I’ve been reading a lot about it.” They were like, “That’s fine.” I wasn’t hearing that from police or government and law enforcement. I was a little hesitant about it, but being in the North Carolina, I had access to all of my advertising group. As I started thinking, I thought, “Cannabis, that’s an interesting thing. It’s nice to have something to relax with as a substitute for wine or beer.” First of all, how do I get it? Where do I do it? Once you do that, you’re stuck with a pipe, a pipe bowl, a bong. No matter what you put into it, you have to figure out a way to put it out. We have the lighter and that’s great. You’ve got a pipe, that’s great. What you don’t have is a snuffer. We thought, “You’ve got some pipe tampers out there and they usually consist of metal.” There are even people in this space, in this industry, that have like a metal spot on it. We wanted to use it as an opportunity for self-expression, personalization, turn the bestselling lighters in the world into a billboard that you control.
Having that and by making it glass, it becomes almost like a piece of jewelry for your lighter. It has incredible quality, UV printed and sealed. It’s the same thing that women will use for their nails or you hit it with the light, incredibly hard, and incredibly resilient. We like to joke that it costs as much as a medium specialty coffee and lasts about three years longer. You can put them on the fridge, interchange them, and being glass and I’m having an oval shape, they’re eighteen millimeters, they do work as a pipe, a sniffer for almost any size bowl, bong, or pipe for the craters. You’re saving money as well on smoke that would otherwise go to waste.
When you went to look for the size of the device and how you were going to fix it to the lighter, basically the design work, did you come on this design immediately or was it an iteration?
The name, Lighter Charms, if you’ll notice on our regular charm, it’s an L and a C for Lighter Charms. Then if you turn it to the side, it looks like a pipe. That speaks to its secret function. That’s how we came up with that initial design, but we had it all designed without the magnet in the back, so we had no way to store it. As we were going over and we’re like, “We’ve got this great thing, what do we do with it when we have a new one?” That led to the magnet idea.
For you to go from concept to manufacturing, were you able to have it manufactured in the US? What was that journey like?
Our lawyer was able to recommend a prototype manufacturer called Touchstone 3D and they were great. They were laughing when I presented the idea, a refrigerator magnet being used to decorate a lighter that’s also a pipe snuffer. It’s a little odd, but they got right onto it. At first, they asked us if we wanted acrylic or glass. Glass was going to be more expensive, but we wanted that permanence and that ability not to get a funky when it’s dropped or used or that type of thing. We tried it out with a bunch of bolts from the hardware store, a bunch of pipes that we bought and see which worked best. I’m trying to make sure that it was as universal as we could possibly make it. For hookah smokers and that type of thing, it’s probably not going to be the best. It’s such a wide bowl, usually over eighteen millimeters, but for the most part, we went around and did a lot of shopping and trying things out.
We’ve gone through the idea and a bit of your background, some of the creation process, who you brought along for the ride. Now, you’re going like, “We think there’s a market.” Take us through your process when you went out to see if there was market.
We had no idea that graphic lighters were so popular. They’re compound annual growth rate is above 10%, whereas it’s above 6% for their regular lighters. Those are BIC’s numbers from 2016, their annual report.
The average lighter user spends or buys sixteen lighters a year.
For the folks that don’t know, how big is the lighter market?
In 2015, it was at $599 million in sales. I believe BIC is tracking into $700 million into 2018 on lighters. It’s a robust market, so enormous popularity. We were lucky enough to have access to that research and to find out, “Where is this going? It’s been around since the ‘70s and this is now how they’re doing it. What can we do to improve upon this or increase freedom for our customers?” The American Flag-wrapped BIC lighters are perfect example of that. It’s a great lighter. Hopefully if someone doesn’t have that same lighter, you won’t lose it. If you get it stolen, you might be able to identify it.
We were talking about this theft problem with lighters. I had no idea. Is it overt or just incidental?
It’s incidental. It might be overt once we start putting lighter charms on there, but the idea is to make your lighters and the thief identifiable. If you see somebody with your charm on it, you’re going to know right away. The average lighter user spends or buys sixteen lighters a year and goes through, if they’re an average smoker, let’s say a pack a day cigarette smoker. It’s a pretty big market. 70% are looking for something that speaks to their own personal interests and needs. As we started looking at that, we’re like, “How do we make it so that it’s even more personalized?” That’s where we ended up.
You have your design and so now, you’re going to go out and go, “I need to go see if I could sell some of these.” Tell us a little bit who your primary customer is and what that process looked like.
Our primary customer is going to be, first, anybody who uses a lighter. If you do use a lighter, probably for more than just birthday candles, chances are you’ve had it stolen or people are borrowing it. If you’re using it to smoke with, then you may have that crusty bottom on the underside of your lighter. You may want the world to know what you’re feeling one day and so you put on a smiley face instead of a devil, or maybe the devil wins. Either way, when you get up, you can change your lighter and it can match your mood.
You have been actively in the market for how long?
We have been actively in the market since February. We did have a few bumpy starts back in 2015. We thought we were going to be ready and we were making them on paper disks so we could do them to order. Then we were using a different adhesive. It was handmade, so you’d put it on the metal disk and then put the graphic on it and then another layer of the adhesive. It just was not going to make any sense for any volume. We’re looking at about 500,000 units from two different distributors and we had to press pause. It was so tough to do but we knew we couldn’t keep up, and we didn’t want to provide something that was going to fall to the wayside. There are enough stories about people who don’t come through. We didn’t want to end up in that group.
We had to stop and then try and automate the process, which was now taking place. We hired a company who’s our current manufacturer CJR Corp in Matthews, North Carolina, but they have a factory in Taiwan. That’s where we’re being manufactured right now. To try and do that automated, I know I just speak English, luckily they’re fluent and just an amazing group. They were able to pull it off and it took about two years because we did it on a super small budget, but we cannot be happier with the way things turned out now.
As you look along your journey right to the point where you’re actually putting them in the stores, what was some of the best advice that you got along the way?
We got a lot of amazing advice. One piece of advice from a good friend of mine who’s in-house counsel at a leading character brand was like, “Demand is better than supply.” That’s always stuck in my head. That’s the first thing that comes to mind but there’ve been so many influences.
Lighter Charms: Don’t gravitate to people that tell you it’s wonderful. Find people who tell you the problems with your product.
Let’s say there’s a budding person out there that wants to develop a product. What advice would you offer to them as far as sequence? How you would go about it if you were going to do this again?
I got lucky in my situation because of the advertising, the agency, and the access. If I had to start with a graphic designer from scratch, that would have taken a lot longer. Our graphic designer is amazing. Our IT guy and web designer are amazing. I’d worked with them for so many years before that. I would say take the scientific method. Don’t gravitate to people that tell you it’s wonderful. Find people who tell you the problems with your product. If you just want something to put on the refrigerator, use one of our magnets and you can put it up there. It’s one and a half pound magnet on the back of our charms. We’ll put your idea up on the thing. If you’re serious about it, find people who are going to be negative, or find people who say no, or find people who challenge you. In your mind sometimes, as you’re designing things, it’s easy to see the rosy view. You psych yourself up in every single day. You’re so excited to talk about it, but it’s more helpful to you and you’re going to get where you’re going faster if you have people who challenge you.
What do you think are the chief misconceptions that people have about putting something like this together and bringing it to market?
One of the things that was interesting is we’ve had some people look at this and just walk right past it, like not stopped to look. It’s new. It’s not a familiar invention at all. Trying to get them to stop and spend some time with it, if I’m able to explain it, then the benefits. There are six benefits per group and those are just our favorites to talk about. Because it’s got fantastic margins for retailers, it’s a continuously refreshed product line. You can introduce new seasons, new charms, new designs, and so your customers constantly have a reason to come back to your store. It fits almost every pipe or bowl that they own. Chances are they own BIC lighters. These will fit all of those lighters.
For these charms, what’s the typical retail price point for one of these?
$4.99.
I’m presuming you had a performer put together?
Yes.
You look at where you started with optimism and hope and you’re like, “I hope this works. I’m pretty committed.” From initiation to this point, how have you been doing as compared to your thoughts and performance?
The education component was bigger than we thought. It took us a while to find that sweet spot on the price. Let’s say celebrity brands that we’re speaking with would not be excited to go $5.99 versus $4.99. We’re like, “That’s the reality of the situation.” We’re definitely still finding the perfect customer for where we are now, and then ways to accommodate every customer that sells a lighter or a pipe.
When you look at your display point and color selection and so on, take us through that thought process and why you picked what you did.
Number one, we want to be very careful about cannabis and the legal status in the United States. Rather than focusing on a snuff your stuff or a snuffer first idea, we were originally going to call it the smoke charmer because that’s literally what it was doing with our first idea. As we started talking about it, we thought lose your lighter is going to be a much friendlier tagline. I went to the University of North Carolina at Chapel Hill and my business partner, we both met in North Carolina, so we thought North Carolina, Carolina Blue.
With your approach to marketing and what you’ve done so far, what are you targeting? What do you think you’re targeting for the growth of your company over the next three to five years? I presume it’s either units or cases.
It’s going to be units. Our goal for this year is going to be 250,000 units and we’re focusing mostly on head shops and the tobacco specialty area. We are amping up for c-stores and our national sales manager who will be joining us in 2018 has a tremendous amount of c-store experience.
I’m sorry, c-store?
Convenience stores. It’s the biggest retail in the country. There are 33% of the retail locations in the country and that may have gone up 154,000 convenience stores. It’s massive now that Amazon is looking on getting into the space where it’s almost a self-serve convenience store and that type of thing. Anywhere where they sell lighters, that’s going to be huge for us, but we wanted to make sure that we could handle the volume. Right now, we can run 100,000 units a month as we get that system in place. The system is the most important. Going back to advice, I’d say focus on the system and not necessarily on the device because if you can get it made in an efficient manner and you can repeat it, your life is going to be so much better.
We’re looking at lighter domination in three to five years. In talking to your current customers, what feedback are you getting from your customers as far as either recommendations or about design or packaging or what the customer’s saying? What are you hearing?
Skulls. Everybody loves skulls. We’re in an interesting place because there are so many male-centered products that are out there and ours are unisex. Men and women both can use these as lighter decorations. We would focus on our female clients first. When we consider designs, we want to make sure that it’s going to appeal to both. That’s very important for us.
Focus on the system and not necessarily on the device.
Do you know your demographic, whether you’re more sales to men or women at this point?
We’re more sales to men based on their frequency in head shops but Merry Jane, that’s Snoop Dogg’s social media company, released a story about women are the biggest consumers of cannabis and the
