Gary Ng, Founder of multimillion-dollar business E-Web Marketing, approached Startup Daily to present his side of the story regarding a reality TV pilot he participated in, which was later accused of destroying a local small business. The other side of the story is completely different and begs the question ‘how far are people willing to go to stretch the truth?’
In June this year, Startup Daily reported on a reality TV show Feed A Starving Crowd that was, at the time, accepting online applications from small business owners looking to execute a kickarse marketing strategy. We learned that Ng, alongside The Apprentice Australia winner and real estate entrepreneur Andrew Morello and best-selling author of the book ‘Feed a Starving Crowd’ Robert Coorey, would be sharing business strategies in the new reality show. Feed a Starving Crowd was supposedly giving away $100,000 worth of marketing assistance to help one local business.
The winner of Feed A Starving Crowd was Mad On Hair and Beauty, a hair salon owned by two Iranian women, Mandana and Sarah, who migrated to Australia in pursuit of a better life. In October, Channel Nine’s A Current Affair (ACA) aired an investigative story ‘Reality TV’s Renovation Shocker’ that painted the perception that the entrepreneurial trio didn’t quite follow through on their promise.
ACA’s report indicated that part of the $100,000 marketing makeover was a major renovation of their salon, worth up to $70,000. This is not the case.
Anyone who viewed the story on ACA – including the before and after pictures of the salon – would be under the impression that, instead, Feed a Starving Crowd left the salon in shambles. The renovation appears to be substandard from an aesthetic standpoint and apparently failed on 19 building regulations.
“Not only did these clowns make a mess of the inside of the salon, but they also decided to change its name from Mad On Hair and Beauty to Salon Q. But what they didn’t do was any marketing or advertising, they didn’t let customers know,” the ACA reporter stated.
BEFORE
AFTER
However, as Ng insists, that’s not the full story. In a non-public video response to ACA, Feed a Starving Crowd said, “This show is not a renovation show, it is a low-budget, do-it-yourself, 30-day business turnaround show, demonstrating how struggling businesses can apply low-cost strategies to turn around on next to no money.”
Why, then, did the salon undergo renovations? Ng stresses that a major renovation was not part of the programme format; the salon owners were never informed of any renovations prior to them signing on. A third party – namely Arthur Knight from Qaba – offered to help restock and refurbish the salon, after a celebrity stylist suggested the salon could do with some fixes.
The stylist stated, “There’s a lot of prints and patterns going on. They’ve got snake skin … zebra prints. There are a lot of things and need a lot of help. Bad fittings … it looks like a backpacker’s sleeping in the back room.”
The video response that Startup Daily viewed privately, showed a number of problems with the salon, prior to renovations. For instance, the owners were washing, drying and hanging towels in the toilet.
“When the show started, after getting some expert advice, it was recommended that the shop can do with a makeover and we were able to get people (Arthur Knight) who was happy to sponsor the renovation. We gave it the go ahead,” says Ng. “Similar to a CRM and hair products, all these were donated to the girls as gifts.”
ACA’s story suggested that the owners, along with their friends and family, were left handling a lot of the pre-renovation tasks, and paying for it from their own hip pockets – including rubbish removal.
However, the whole idea was to keep the renovation budget as low as possible, with Morello suggesting that the owners get their friends and family on board to reduce costs. Sarah said her contacts would be able to help out, and that they’ve done it themselves before.
But they weren’t alone in the renovation process. At his own cost, Knight flew a team of tradesmen from Melbourne to help renovate the salon. He also arranged for his company Qaba and others to supply the salon with free product and equipment, given the owners ran out of money to stock up and update their equipment.
The report also indicated that the renovations failed on 19 building regulations. However, Feed a Starving Crowd said that all electrical and plumbing work was performed by qualified tradesmen, and later found out that the new salon did in fact meet regulations.
“The tradesmen employed by the show also fixed up numerous pre-existing regulation breaches at the salon. The show paid these additional costs and didn’t pass them on to the owners,” it stated in the video response to ACA.
Sarah and Mandana
Interestingly, the women, who appeared to be completely distraught by the ‘botched’ renovations, were actually pleasantly surprised when they saw their new salon. After the blindfolds came off, they screamed in joy, repeatedly saying ‘I love it’. Mandana even said it was ‘simple’ and ‘chic’.
They also liked the name change. Sarah said ‘I like the name, definitely. And definitely better than Mad On Hair. Anything is better than Mad On.”
ACA also stated that the salon’s customers were not made aware of the name change, and that this was the host’s responsibility. However, after 19 days into the 30-day challenge, it was communicated explicitly that it was the salon owners’ responsibility to organise the marketing and PR around the renovation and to notify customers of the name-change. Sarah even agreed to email their customer-base.
One day after the new salon was revealed, however, Sarah and Mandana had an extreme change in attitude.
“The revenue and profitability of the salon increased significantly from our coaching and help. It is unfortunately after 24 hours of being over the moon ecstatic about the renovation to being completely unhappy,” says Ng.
The show’s hosts returned to discuss their complaints and organise the completion of any work that was left unfinished during Knight’s 48-hour renovation.
Where before they said they “love the lights”, “love the floor” and “love the table”, one day after they decided they hated it. While it could be argued that their latter judgement is correct, the question is why did they ‘love it’ in the first place?
In the footage that Startup Daily viewed, it is apparent that Sarah was livid, even though the show hosts tried to handle the complaints diplomatically, even willing to make modifications or returning the salon to its original state.
Sarah said, “I’m going to tell you how I like my shop and you are going to have to do it. Because I’m not going to [hold] what you gave us … I’m going to tell you what’s going to happen, if that doesn’t happen, then I think we [will] have a [new] reality show for you guys. I’m serious.”
Sarah and Mandana could not agree on what modifications they wanted and no progress was possible at the time.
Another thing that’s become apparent in the footage, is that Sarah and Mandana do not get along. They admit that they regularly argue in front of customers using swear words, and overall, don’t deliver the best customer service.
Mandana said arguments spark because Sarah always believes she’s right and focuses on what the business needs, not taking into account what the business can afford.
Sarah also said in the initial days of the challenge, that she didn’t believe the business would last more than six months if things continued the way they were. Only one in 10 were returning customers, and the owners were still paying bills from last year.
Coorey looked into the business’ profits and losses and found that the salon had already lost $6,000 this year. The owners also hadn’t paid GST to the government and haven’t been able to pay themselves consistent salaries.
Although ACA implied that the salon owners received no notable marketing assistance, this is incorrect, according to Ng.
Prior to Feed a Starving Crowd’s intervention, average spend per customer was $50. Sarah admitted that this number increased to $85 per customer after employing various new marketing strategies. She also said that rebooking rates went up from 5 percent to 25 percent.
When asked about how the “$100,000 worth of marketing assistance” was quantified, Ng told Startup Daily that he, Morello and Coorey each charge up to $25,000 a day in consulting, which is undeniably exorbitant, but understandable given their track records.
“[In the 30-day challenge] there was a minimum of 20 days between the three of us that went into helping this business turn around. It equates to $500,000 business turn around. So even if you only take 20 percent of that, that is already over $100,000 in marketing consulting services which resulted in their business growing from $2,300 a week to $3,600 a week,” Ng explains.
He also stresses that during the challenge, Feed a Starving Crowd organised a huge Scoopon deal that featured Mad On Hair and Beauty; and the campaign was so successful that Sarah asked for it to end because they couldn’t handle so many new customers.
“Any of the marketing work we did with the girls, their business improved significantly to the point that they asked us to turn off the promotions as they couldn’t handle the extra business. I have no negative feelings towards the girls and wish them luck,” says Ng.
On the video Startup Daily sighted, Sarah clearly indicates that Ng, Morello and Coorey’s efforts have been helpful: “Already my customers are very happy with whatever’s happening in the salon. I think the publicity is great.”
At one point, Mandana even said, “God sent you … just dropped on my life to bring me up … I can’t believe this is happening to me. People like you come to help us … it’s fantastic, great feeling.”
Unfortunately, the gratitude was short-lived.
Feed a Starving Crowd said the biggest problem was that the owners had a major personality clash and couldn’t stop arguing about what’s best for the salon – this kind of co-founder drama, however, isn’t all that uncommon.
“The biggest challenges to the girls succeeding in their business is taking ownership. Before we came along, the girls will constantly fight with each other to the point they would swear in front of the customers and customers would walk out in the middle of a hair treatment. Blaming the outside world for your lack of success will only get you so far in life,” says Ng.
He explained this bluntly to the owners as well, saying: “The strategies we give you is going to be pointless. You guys need to come up with your own ideas on you’re going to do it because we’re not going to be here forever. And we don’t want to give you band-aid solutions … BANG! 30 days, solution, fixed. You need to be able to do this by yourself.”
The relationship between the salon owners and Feed a Starving Crowd ended when the owners threatened to go to ACA and pursue legal action. On July 18, the hosts also received a phone call from one the salon owners – namely, Mandana – stating that she was afraid her business partner who allegedly has a drug problem would harm her. She warned the hosts that they were also potentially at risk.
“Madana told us that Sarah had drug problems and connections to gangsters and warned us to be-careful of her. That is when we decided we would leave the both sides of legal work out on a amicable outcome. If we were only working with Madana, I had no doubt we would have arrived at a happy outcomes for everyone. Sarah wanted fame, this is what we’ve been told by Madana, she would not rest otherwise. Madana contemplated leaving the partnership with Sarah, but feared for her life if she did,” says Ng.
When asked about why this information wasn’t given to ACA during the ambush, Ng insisted that ACA “was not interested in gathering the truth”.
The ACA visited E-Web Marketing’s headquarters two days before the story was scheduled to go on air. Ng says they were employing “shock tactics” and that a lot of the conversation was cut out, creating the perception that Ng was dumbfounded and guilty.
“Subsequent request to provided further information in a proper interview format was ignored. Even if it was accepted I doubt they would utilise material that would debunk the story as it was already scheduled to go to air in 2 days time, when they stormed the office,” says Ng.
“Anything I said that debunked and refuted their allegations was cut out. Hence it showed me in complete silence for most of the time even though they were in conversation with me for a good five to 10 minutes.”
Ng admits that he was shocked and unprepared. He shared a lift with the ACA team, and as soon as the elevator doors opened, the team turned the lights on and began their “ambushing tactics”.
“[The] report was not interested in the truth, its prime motivation was to get drama. It said I had ignored and hung up on the girls calling me. I said the girls have not called me once and I have never hung up on them. I said ‘do you have phone records to support that?’ The reporter did not respond and quickly moved on to another allegations,” says Ng.
But why not try to control the narrative as soon as the allegations were made? Even Startup Daily received four emails since the airing of the story from entrepreneurs wanting to share their views. All commentary was negative. But Ng says the reason why it’s taken so long to respond is because they “didn’t want to add fuel to the fire”.
“The longer the story dragged on, the more damaged it would do to our business I feel – both in reputation and negative energy. There are people who make judgement of what they see on TV believing it is the truth. ACA obviously have prime time reach on TV,” says Ng.
“We always intended for the truth to come out, in the time we felt is right that it wouldn’t do more harm than good.”
According to Ng, their intentions were always solely to help. There were no financial incentives and the hosts were not being paid for their efforts.
Ng, who claims to have a personal goal of bringing happiness to 500 million people by 2020, laments that his non-for-profit organisation World Happiness Foundation which has funded projects like puunky.com was created two years ago specifically because “[news media’s] prime motivation is to create fear-based stories that sell, where there is so much good in the world we can accentuate”.
“It is really disappointing that something we did to help people can be turned to something that will be used to harm us. Nevertheless it will not deter myself or my team in going out each day to help people, what it has done is that it taught me to put more things in place to protect us of similar situation from arising,” says Ng.
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The ACA’s investigation’ “Reality TV’s renovation shocker” can be viewed here.
Startup Daily’s previous report on the matter can be read here.
Featured Image: Gary Ng, Founder of E-Web Marketing. Source: Provided.
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