Strategies for Distributing Your Brand for Growth

In the entrepreneurial landscape, the decision to directly serve our customers at Kombuchade, bypassing traditional distributors, often raises eyebrows. Yet, it's worth asking, have we not seen the remarkable success of Red Bull? A closer look reveals that Red Bull's meteoric rise was significantly fueled by its strategic choice for Direct-Store-Distribution (DSD), especially through the establishment of the Red Bull Distribution Company. Why embrace DSD, you might wonder? The answer lies in leveraging unparalleled control and fostering direct connections, much like Red Bull did. Let's dive deeper: 1. Control Over Distribution: Direct distribution allows businesses unparalleled control over how their products reach the market. This means ensuring optimal delivery times, maintaining product quality, and being agile enough to respond to market dynamics in real-time. 2. Inventory Management: By directly managing distribution, companies can significantly improve inventory efficiency. This approach enables a more precise alignment of stock levels with real-time demand, reducing the risk of overstocking or stockouts and thus optimizing operational cash flow. 3. Cost Efficiency: Cutting out the middleman reduces layers of costs associated with third-party distributors. These savings can be redirected towards competitive pricing strategies, product development, or enhanced marketing efforts, driving both growth and profitability. 4. Brand Consistency: Direct distribution ensures that every customer interaction with your product is consistent with your brand's values and messaging. This uniformity is crucial for building a strong, recognizable brand that resonates with customers and stands out in the marketplace. 5. Enhanced Customer and Retailer Relationships: Direct engagement with the market fosters deeper insights into customer preferences and retailer needs. Such insights are invaluable, enabling businesses to tailor their offerings more precisely and build lasting relationships based on trust and mutual benefit. In conclusion, while the path of direct distribution demands more from us as entrepreneurs, the potential rewards in terms of brand integrity, customer loyalty, and operational efficiency are immense. Like Red Bull, companies that dare to directly connect with their market can achieve unparalleled success. Let's embrace the challenge and transform our industries.

A singular focus on digital DTC was great early on, but it almost ended up putting us out of business. Expanding distribution channels allowed us to achieve scale, leverage and profitability, but it was only possible by investing in Brand. So you can get the buy-in to build the Brand that fuels successful channel expansion, here are: 1) Three things learned about shortcomings of DTC-only, and Brand building's essential role in successful retail expansion, 2) Three ways you can update your thinking on the topic, and 3) Three things you can do about this today Let's do it ** Three things learned about shortcomings of DTC-only, and Brand building's essential role in successful retail expansion ** 1. The total market potential for DTC branded e-commerce is inherently limited – on average, about 5 to 7% of your business’s total market potential (e-com is 16% of retail. 66% of e-com is owned by big retailers) 2. Yes, this 5 to 7% is the easiest to access. With a creative product, you can spin up a site, run some ads, and boom you’ve got a business. You can grow quickly and to a decent scale. However, because of the scale limitations and the fact that the digital ecosystem is typically governed by paid direct-response promotion, building a highly profitable business on just this 5-7% is difficult 3. When a category buyer takes a look at their market, they're asking: Will this Brand add to the pie? Will it bring an audience and attract more buyers as opposed to simply displacing competitors by competing at the price and offer level? Is there a real Brand here? ** Three ways you can update your thinking on the topic ** 1. With expanding distribution, the critical questions are: Why would retailers want to carry my product? What’s the unique value proposition of my Brand to a retail buyer? How does carrying my brand get that person promoted? 2. While it's great to 'get that email address' and 'own the transaction', it's less great to have your Meta acquisition cost go up 50, 100, or even 200%. Sure, retailers take their cut, but it doesn't 3x 3. While there are downsides to any channel, the potential scale of contribution dollars retail can generate helps power more product innovation and brand building ** Three things you can do about this today ** 1. Take a fresh look at your channel strategy. Does it still align with everything you've learned about your biz and the dynamics of digital-only customer acquisition? 2. Exceptional product IS the Brand. And, whether you like it or not, so are your DR ads, promos, manufactured urgency, and discounts. You're building a lasting impression with all of it. Ask yourself, "Is it the impression I want?" 3. Review the investments you're making to drive growth. Are they building the Brand where the answers to the category buyer's questions are a resounding YES? It wasn’t until we realized this sneaky truth at Chubbies that we really found the path to sustained and systematic profit growth

Why I Love to Scale & Transform Businesses + How I approach it? My career predominantly involves the intricate art of scaling or orchestrating complete transformations within businesses—a dynamic interplay I've come to visualize as a "double helix matrix" strategy. It's about navigating the intricate balance between broad strategic perspectives and granular details, amalgamating diverse data points to craft not only long-range plans (LRPs) but also immediate actionable strategies.   My approach starts with:   1. People: Understanding each team member's skills, passions, and roles, optimizing internal placements and, if needed, seeking external talent to bridge skill gaps. 2. Setting a compelling vision, a mission statement, and fostering a shared value framework. Simultaneously, my process involves: 1. When delving into a brand, I liken it to understanding a person. I prioritize comprehending every facet of the consumer experience with the brand. To achieve this, I undertake an exercise I term a "Beautiful Mind." This involves visualizing every consumer touchpoint—social posts, hang tags, catalogues etc.—in 1 room. Additionally, I analyze data from the top 3 competitors. This process is aimed at uncovering the authentic message conveyed by the brand to its consumers, enabling the development of a strategy to unify the brand messaging & ensure clarity @ the true points of differentiation. 2. Another pivotal brand element is its product line. I organize products in the same room based on their architecture—highlighting hero SKUs and franchises, while aligning this arrangement with financial data. I assess how well the merchandising details, financial metrics, and brand story synchronize, identifying any disparities. This analysis aids in understanding the coherence between product strategies, brand messaging, and financial performance. 3. Collaboration with the CFO, CRO, CMO, Head of Product, COO and the Board of Directors is critical in order to drive pivotal shifts: a) Balancing distribution mix by diversifying channels and ensuring maximum value creation considering margins for each channel. b) Exploring opportunities for geographic diversification, unraveling global scaling limitations, and expanding into untapped regions. Implementing the strategic plan alongside a team is where the real thrill lies. Witnessing the rapid progress, dynamic energy, and profitable results in value creation for the long-term is truly gratifying. #valuecreation #scalingbusiness #transformationalleadership

In the conversations I’m having lately, there’s a lot of optimism that the industry is in recovery, but also an expectation that things won’t truly pick back up before the second half of the year. But there are always opportunities to gain share—if you have the right fundamentals in place consistently. Here are 5 that I think are critically important for brands right now: 1. Regularly releasing new products—even at a quarterly cadence, if possible. Retailer algorithms often favor new items when they initially roll out, so this can give you an edge. 2. Having clean and complete product data. That also means being able to get additional required imagery and attributes that retailers are regularly asking more of (if you work with Lowe’s, you know what I mean). 3. Using a never-out list to ensure your top 100 products never (ever) go out of stock. That’s different than keeping a healthy overall in-stock rate. Disproportionately allocate your capital to the products that make up the majority of your sales. 4. Consistently meeting sharp lead times and solid operations. This meets the expectations of both your retail partners and the end customer. 5. Ensure the marketing programs that you are engaging in are producing and that you’re spending in the right places for each retailer. Not all programs are created equally. This is an opportune time to really make sure you’re getting your online business right and that your brand is positioned to evolve. That will not only help you take share in the short term but will let you capitalize when the customer is more “fully” back and competition ramps up further.

I speak to a lot of new brands as they are coming online and wanted to share a piece of advice for folks starting or thinking of starting a cannabis brand. Be able to articulate how your brand grows the pie when speaking to potential retail partners. The average retailer in IL for example has nearly 700 Skus on their menu. Krista Raymer had a great post this morning about the issues that a high level of sku count can cause dispensaries. There will always be room for (truly) top-shelf flower and concentrates but if you are thinking of offering edibles, vapes, or other MIPs you must be able to articulate how you are: 🥦 Driving net new customers into their store 🥦 Getting their existing customers to have a higher basket size because of your offering 🥦 Getting their existing customers to shop more frequently Achieving this requires building a loyal customer base, offering unique products, and ensuring quick product turnover at your current retail locations. Success isn’t about being available in every store; it’s about strong sales and regular reorders at the stores where you are stocked, which then fosters strategic growth with the right retail partners, ultimately leading to sustainable brand development.