Entrepreneurial Brand Thinking
(10 min read) WE'RE IN A GOLDEN ERA FOR ENTREPRENEURIAL BRANDS. They seem to emerge out of the ether and then they're everywhere. Big companies keep getting blindsided by upstart brands in virtually every category, from mattresses (Casper) to eyewear (Warby Parker) to beverages (Honest Tea) and snacks (Kind Bar), just to name a few. WHY now?
FOUR FORCES ARE CREATING THE PERFECT SOIL FOR ENTREPRENEURS TO THRIVE IN.
First there's a Sapphire mindset. Sapphire in this context means seeking out "new and shiny objects." I heard this term from a large company that shared the remarkable statistic that 50% of millennials believe new brands and products are preferable to the tried and true brands of prior generations. Not only this, but discovering those new brands and sharing them with your friends brings social cachet.
Second, there's a desire for purpose. 74% of millennials are looking for a job that matters. And that extends to the brands they choose to bring into their lives as well.
Third, the internet and specifically the rise of e-commerce and direct-to-consumer sales channels have torn down the barriers that traditional brick-and-mortar stores put in the way of reaching consumers.
And lastly, there's a boatload of money sluicing around looking for the hot new brand to invest in. Whether that's the $148 Billion of venture capital money in start-ups last year or over $600 million in Kickstarter funding for getting your idea off the ground.
So, the world is primed for entrepreneurial brands. But what exactly is the entrepreneurial brand thinking that sets them alight and causes them to take off. What are the approaches they do differently from established brands and big companies?
These upstarts toss out the old rules of brand development and adopt tactics that work like a commando raid on the establishment. I've laid out eight things they do that make it sound easy — though life is rarely easy as an entrepreneur. What they share is a passion for action and following their instincts over and over again.
1. THEY'RE TOTALLY IN TOUCH WITH THEIR CUSTOMER BECAUSE THEY ARE THEIR OWN CUSTOMER.
In big companies, brand managers rely on literally piles of consumer research to understand customer insights and invent products. Not so with entrepreneurs driven by their own personal dissatisfaction with the status quo. They are so deeply attuned to what people like them feel, decisions come quickly and intuitively.
As a Mom in Houston, Tiffany Masterson struggled with rosacea and was obsessed with skincare to help avoid redness and inflammation. She started heavily researching product ingredients and discovered that what matters is not just what ingredients are in the product, but what ingredients are NOT in the product – or as she says A product is only as good as its worst ingredient.
She wrote herself a wish list of what she wanted:
This personal dissatisfaction and journey of discovery is the central driver in entrepreneurial brand thinking.
Through her research, Tiffany discovered one ingredient – marula oil – with all the natural powers she was looking for and six ingredients to avoid – what she dubbed the suspicious six. She created a small line of just the six essential products she needed and launched a new category of skin care she calls "clean clinical" with eye-catching neon packaging she knew would look great on her vanity and on instagram. She even named the brand herself, Drunk Elephant. After hearing stories that when elephants in Africa eat marula nuts, they ferment in their stomach and make them drunk. What a great story, she thought. People will love that and it's so memorable.
But the buyers she approached at Barneys, Bergdorf's and Space NK all disagreed. They thought it was a terrible name and told her to change it. She refused, sent samples of her packaging to beauty editors, and persuaded Sephora to take a chance on her brand. In just three years she's built one of the hottest brands in skin care. Her babyfacial was the top selling skincare product on Sephora's website in 2017 and frequently sells out.
2. THEY PREACH PURPOSE OVER PROFIT.
In big companies, there's been tons of interest in purpose. I've had the privilege of hearing P&G's ex-CMO Jim Stengel tell marketers to find theirs.
But that's markedly different from actually starting a brand with purpose like Sarah Kauss did with S'well.
In 2010, she launched S'well with the mission to rid the world of plastic water bottles. The average American uses 167 plastic water bottles each year and only 38 of them are recycled. That's an astonishing 50 billion plastic water bottles each year polluting our land, our waterways and our oceans.
What Sarah understood is that just telling people to stop using plastic water bottles was a hopeless endeavor. But by building a better option, a fashionable bottle that would keep water icy cold for up to 24 hours or steamy hot for up to 12, she could stop people buying disposable bottles.
Seven years later, Sarah owns the fastest growing woman-owned company in America. S'well is the first hydration fashion accessory! They release 30 designs each season and once they're gone, they're gone. She built her brand through associations, from being the official water bottle of New York Fashion Week to the Official water bottle of the TED conference. Her brand has been built by word of mouth, one enthusiastic user to another. And ultimately what's driving her is the amount of plastic we're keeping out of landfills and our waterways.
3. THEY SPEAK REAL HUMAN.
In big companies, humanity quite frankly gets edited out of copy by going through too many reviewers. You'd be unlikely to come across a bold statement like "Go Buck Naked," the invitation from Duluth Trading Company to try their underwear that "feels like wearing nothing at all." Wisconsin-based Duluth understands real-world clothing problems and solves them in humorous ways, like longtail t-shirts that fix "plumber's butt" and Ballroom Jeans that let you "crouch without the ouch." Backed by a "no bull guarantee," their charm and humanity has delivered 27 quarters of revenue growth, when many retailers are struggling to just stay afloat.
Same humanity comes through loudly with Seventh Generation. At 28 years old, they're not a newbie, but they hold onto the passion for preserving the planet for the next seven generations that launched the brand in the first place. Even since they've been acquired by Unilever, I admire their calling on their fan base to participate in political process and change laws to be more transparent about ingredients in cleaning products and feminine hygiene products. And they understand that lots of people out there in the world are skeptical, and need to be surprised and seduced into their way of thinking. And who better to do that than Maya Rudolph singing about "keeping things pure and clear down there" in the viral video "vajingle, y'all."
4. THEY DESIGN AMAZING EXPERIENCES.
In big companies, design is constrained by supply chain and procurement.
That gives entrepreneurs like Simon Mottram the opportunity to create something totally mind-blowing for people like him who love road racing. In 2004, he launched Rapha, a brand for people who love the grueling sport that demands a very high tolerance for pain, bringing high style to cycling. Paul Smith was his inspiration because you weren't just walking into a clothes shop, you were walking into Paul Smith's mind of curios. Simon wanted to create an emporium as a platform to connect with customers.
Rapha has evolved into that emporium and ecosystem for road riders around the world. With over 100 products of high-performance clothing and gear, the brand encompasses a world-class cycling team, a super-cross racing series, a bi-monthly cycling magazine, a gallery and shops, and multiple blogs covering the sport.
As a brand consultant, Simon knew tricks like writing faux business pieces, Financial Times or Wall Street Journal articles, about a company in the future. So you can sort of say, "That's what we're trying to achieve." He wrote one for Rapha in 2005, that talks about Rapha revolutionizing the cycling market and leading more people to discover road racing as a lifestyle and a fundamental part of their lives. It talks about 25,000 Rapha customers meeting at Rapha cycling cafes, going for rides together, consuming Rapha coffee, being all part of a club. It talks about some of the products, reading magazines that Rapha publishes… The way it described the business was actually very accurate to what it became.
Simon firmly believes that road cycling is the most beautiful sport in the world, and the toughest sport in the world, and should be the biggest sport in the world. And he's well on his way to making that true.
5. THEY PRACTICE RADICAL TRANSPARENCY.
Big companies have big secrets and they're dedicated to protecting them, like finger-lickin' good chicken or the famous secret formula for Coca-Cola.
That's why Kind bars were so revolutionary when they arrived on the market and proudly announced "ingredients you can see and understand." What's interesting Is that early reactions to this positioning were pretty skeptical. People said they looked too healthy and probably would taste like sawdust.
The key to their success wasn't packaging or positioning but sampling. In 2008, Lubetsky's sampling budget was $800, but after he got some investment capital, that ballooned to $800,000. And today, Kind spends upwards of $15 million in efforts to get people to try Kind bars.
The company has a full-time field marketing team in 25 U.S. markets that organizes sampling in stores, sponsoring sporting events, taking free samples into corporate offices and putting them in gift bags at company events.
Out of the 2,000 products in the nutritional bar category, six of the top 10 fastest-selling products are Kind bars, according to Nielsen.
After it seemed like Kind had maxed out on the transparency meter, along came Rx Bar. No one thought the world needs another protein bar, not even Peter Rahal and Jared Smith. So that barrier to entry set their strategy: to sell into CrossFit gyms and be the product that's designed for them. They started in Chicago and just dropped by the gym, door to door essentially, calling, emailing, just like traditional sales. It was only gyms.
Just like Kind, sampling was critical and when you do that you learn how to to market it. It's really valuable data you're collecting. They gave someone an RXBar and it was like, what is it? We'd be like, well it's like eating three egg whites, six almonds, four cashews, two dates. People are like, oh that's awesome.
That led them to a different kind of brief for their designers. People like RXBar because of it's minimal ingredients. People don't buy it because of the brand name. They knew they had to do things differently, because the category was competitive.
Before the redesign, they did the trade show circuits and no one gave them any love. At Expo East 2015 they came out with the new packaging and got picked up by Wegmans, then Whole Foods, Publix. Then Trader Joe's was the first to give them national coverage. Two years later Kellogg's bought Rx Bar for $600 million.
6. THEY FAIL FORWARD.
Big companies excel in preventing failure. They take inordinate care to validate decisions before they're launched publicly. You've probably all seen the project timeline that has six weeks of creative development followed by two months of research to validate.
Entrepreneurs accept that moving ahead with about 70% of the information you need is preferable to delaying action until you have all the information you'd like to have.
In the spring of 2015, Chris Mears was in supermarkets handing out samples of his new premium, chocolate-covered candies, called Little Secrets. "Oh," one woman said, "this is perfect for my kids." Another customer ate a chocolate and said, "I didn't think it would taste this good!" Both were meant as compliments, but they made Mears anxious. His candy wasn't for kids.
The problem was easy to diagnose. "When people say things like that, it's clearly a packaging issue," he says now. The premium chocolate market is full of serious brands like Ghirardelli, and he wanted something more welcoming. He imagined his candy appealing to 30-somethings after a long workday, so he created a bright, busy bag. To riff on the name (a nod to how people tend to eat chocolate alone), he added mythical creatures like unicorns. But as he discovered, this all made his candy look cheap -- turning off customers and many major retailers.
He came to us and said "Create a mouthwateringly delicious, mind-blowing candy-coated chocolate brand," and he gave a clear hierarchy of information to appear on the new bag. First the brand name. Then the chocolate and the flavor And finally, what makes the chocolate special: fair-trade, with no artificial ingredients.
The result was clean but playful, with the brand name surrounded by tasty food images. It rolled out in May 2016 and clicked with retailers. Little Secrets quadrupled the number of stores it was in, to about 4,000, and national chains that once said no were now saying yes.
But something still wasn't working. Chris showed consumers his new bag and asked, "What is this product?" The answers were wild. "I had some say, 'Is it a trail-mix-type thing?' And I was like, wow, that's so interesting, because people are just so literal." The bag says "dark chocolate candies," but their eyes went to the food images and skipped everything else.
Chris realized he needed people to understand the form first.. "When they're at the front register, consumers are thinking, What looks good? You have one to two seconds to communicate that," he says. The new bags are shipping now, just in time for national distribution at Whole Foods starting this June. Chris says "I'm really trying not to make packaging redesign an annual thing," he says. "But I'd rather do it now when we're as small as we are and get it right."
7. THEY TELL INSPIRING STORIES.
Some brands have great origin stories and some make them up. Either way, stories wend their way into our hearts and memories more effectively than plain old product attributes and benefits. Mark Ramadan and Scott Norton created a fictional character, Sir Kensington, and his backstory as an aristocrat who created a side of ketchup on the spot when Catherine the Great requested some to go along with her beef. Their fast-growing condiment brand can trace their success to Sir Kensington's demands for exceptional quality ingredients, painstakingly prepared. He may be fictional, but their sales results are definitely not.
At big companies, marketers still, to some extent, rely on the 30-second TV ad. Entrepreneurial upstarts are playing a different game. Tomboy X is a brand with an agenda. They call it the human agenda. An agenda that says we are all people. Started by two tomboys, Fran Dunaway and Naomi Gonzalez, Tomboy X is the anti Victoria's Secret underwear company. Their tagline is "We're not for everybody, but we are for any body."
Insane comfort and fit is just the starting point. Tomboy X celebrates inclusiveness through their photography and profiles, going way beyond the body inclusivity story of Aerie, the underwear brand owned by American Eagle. Their logo X= stands for equality. Tomboy X believes you should be exactly who you were born to be – no apologies.
When they celebrate black history month, they celebrate disabled black history month, letting people know about the disabilities that black leaders struggled with as they made history. They celebrate roller derby athletes and androgynous models with powerful content designed to be shared.
So, entrepreneurial brand thinking: it seems so easy, but it's absolutely not. Each of the brands here put in enormous amounts of work and overcame massive hurdles to get to this point, and each of them is still finessing, innovating and surprising us. What they have in common is a willingness to follow their instincts and make big leaps.
The appropriate phrase here would be the Latin audentes fortuna iuvat, meaning "fortune favors the bold."