Sustainable brand growth that attracts future shoppers will be tied to ethical practices including conscientious human-like characteristics. Aligning with mission-based causes, Citizen Brandhood is the focus of David’s new book, Beloved & Dominant Brands.  

Welcome. The primary thing that sets natural brands apart from their mainstream competitors is the Achilles heel of their competition. Let me explain. Mainstream brands, retailers, and solution providers tend to commoditize the natural consumer. They tend to commoditize the way that everyone shops, and the stores that you shop in. Let me explain. Big companies tend to think of their consumers as all being the same. Very generic, if you will. In other words, female, head of household, 2.3 kids, et cetera. There’s not a lot of differentiation. I believe that this is one of the fundamental reasons why they struggle so much at retail.

I’ve talked a lot about how natural brands are responsible for sustainable growth across every category and every channel. In fact, on every single podcast page, there’s a link to the 2016 feature article that I wrote for the 2016 Management Handbook. The point is this, in the absence of natural organic, every category would be flat or declining. This is why natural organic products are so important to mainstream retailers, and why so many mainstream brands are acquiring them. 

So, why does this matter? Because they’re trying to understand that unique consumer that buys your products. They’re trying to tap into that magic that you have, in terms of your ability to relate to and connect with that consumer. Now the reality is that understanding who this core consumer is, takes a lot more than just simply acquiring a company. This is your greatest opportunity to differentiate yourself from your mainstream counterparts. This is your greatest opportunity to stand out on a crowded shelf. And more importantly, if you leverage this properly, this is going to give you a significant and sustainable competitive advantage at retail. 

In other words, retailers want three things. They want more traffic in their store, they want a reasonable profit, and they want a competitive advantage in their market. You have the opportunity to provide that by educating the retailer about that unique consumer that your product drives into the stores. 

This is why today’s show matters. This should be at the heart and soul of your brand positioning. This is the foundation that you need to be building your brand on. And today’s special guest is the absolute perfect person to help communicate this to you. You’re going to want to stay tuned.

Download the show notes below

Click here to learn more about Retail Voodoo

Click here to learn more about Beloved & Dominant Brands

Click here to buy the book  Beloved & Dominant Brands

BRAND SECRETS AND STRATEGIES

PODCAST #147

Hello and thank you for joining us today. This is the Brand Secrets and Strategies Podcast #147

Welcome to the Brand Secrets and Strategies podcast where the focus is on empowering brands and raising the bar.

I’m your host Dan Lohman. This weekly show is dedicated to getting your brand on the shelf and keeping it there.

Get ready to learn actionable insights and strategic solutions to grow your brand and save you valuable time and money.

LETS ROLL UP OUR SLEEVES AND GET STARTED!

Dan: Welcome. The primary thing that sets natural brands apart from their mainstream competitors is the Achilles heel of their competition. Let me explain. Mainstream brands, retailers, and solution providers tend to commoditize the natural consumer. They tend to commoditize the way that everyone shops, and the stores that you shop in. Let me explain. Big companies tend to think of their consumers as all being the same. Very generic, if you will. In other words, female, head of household, 2.3 kids, et cetera. There's not a lot of differentiation. I believe that this is one of the fundamental reasons why they struggle so much at retail.

I've talked a lot about how natural brands are responsible for sustainable growth across every category and every channel. In fact, on every single podcast page, there's a link to the 2016 feature article that I wrote for the 2016 Management Handbook. The point is this, in the absence of natural organic, every category would be flat or declining. This is why natural organic products are so important to mainstream retailers, and why so many mainstream brands are acquiring them.

So, why does this matter? Because they're trying to understand that unique consumer that buys your products. They're trying to tap into that magic that you have, in terms of your ability to relate to and connect with that consumer. Now the reality is that understanding who this core consumer is, takes a lot more than just simply acquiring a company. This is your greatest opportunity to differentiate yourself from your mainstream counterparts. This is your greatest opportunity to stand out on a crowded shelf. And more importantly, if you leverage this properly, this is going to give you a significant and sustainable competitive advantage at retail.

In other words, retailers want three things. They want more traffic in their store, they want a reasonable profit, and they want a competitive advantage in their market. You have the opportunity to provide that by educating the retailer about that unique consumer that your product drives into the stores.

This is why today's show matters. This should be at the heart and soul of your brand positioning. This is the foundation that you need to be building your brand on. And today's special guest is the absolute perfect person to help communicate this to you. You're going to want to stay tuned.

Before I go any further, I want to remind you that there's a free downloadable guide for you at the end of every episode, in addition to other brand-building links that you're going to get from our guest today. I always include one easy to download, quick to digest strategy that you can instantly adopt and make your own, one that you can use to grow sustainable sales and compete more effectively with. Remember, the goal here is to get your product on more store shelves, and into the hands of more shoppers.

If you like the podcast, share with friends, subscribe, and leave a review. Remember that this podcast is about you and it's for you. Let me know your specific bottlenecks are, and I'll make sure that I include those in future episodes. Now here's today's guest, David, with Retail Voodoo. David, thank you for coming on today and for making time for us. Can you please start with sharing a little bit about yourself, and how you got to where you're at today?

David: Sure. Thanks for having me, Daniel. I'm very excited to have this conversation today. A little bit about my history, I have been in the agency world for about 30 years. About 10 years ago, I had some things in my personal life that really woke me up to how broken the food system is, and how the food that we eat is often not good for us. So, I was early in on the idea that natural and better for you and clean ingredients, and organic, and understanding that you are what you eat should become normalized. And so, I repositioned my agency to focus exclusively in that category, and have never looked back.

Dan: Good. Can you talk a little bit about that? I mean, I certainly don't want to go into anything that is private or get you to reveal anything you don't want to share, but what made you come to that understanding? And more importantly, how do you see that manifesting in the work you do today?

David: Yeah. Again, it's how it came to me was actually really, really quite personal. People in my family got sick. My parents got sick, my siblings got sick. And then, it hit even closer to home when one of my children started having food allergies. This was just long enough ago, you have to recall that food allergies were not a common theme. There were no free-from foods, for example.

When I took my child to the western medicine doctor, I was laughed out of the office. After that happened about a half a dozen times, I went to a naturopathic doctor with this child, and we did a couple of blood tests, we did an elimination diet, and his whole life changed. His immunity system changed, his behavior changed, his ability to focus, everything changed.

And so, I was lit up about that, and that applies today. Again, our company, really our mission as an agency is that we want to help change what people do and think and feel about food and beverage for the better, and help them get a deeper understanding of what they do to stay active, and how they take care of their body, mind, and spirit. We know our mission will be accomplished when there's no such thing as a specialty natural store. We feel like we're halfway there because there are natural sections in every conventional grocer across the country now. The movement is well its way.

Dan: I appreciate you sharing that. And the reason I wanted you to go back to that, and thank you for doing that, is because it helps frame the conversation. What I mean by this is that there are a lot of people out there that will read a book or will listen or read an article or something like that, and they think that they've figured something out. But when you live it, that changes things. Then it becomes ingrained in you, it's a part of your DNA, a part of who you are.

The point being is that now you can relate to the brands that you're working with to help them leverage their selling story at retail. Can you talk a little bit about how you work with those brands, and what specifically does Retail Voodoo do your agency?

David: Yeah. It's really personal. We are out to help those entrepreneurs and those people who are really bent on changing the world for the better, to be the ones who are disrupting and recreating the food system, and changing Big Ag, and changing farming, and those brands that will popularize those ideas so that new methods come into being. We're helping them at every level.

And where we are most valuable is not necessarily for a startup who's trying to figure out their stuff to get their first sale, get their first thing together, although we do some of that. We are really good at once you have been established and you have a new idea, and you're the one and only of a thing, and then when you start to get knocked off and there become copycats, and you become instead of being one and only you become one of many, we are particularly good at helping you get back to category prominence through storytelling, through understanding you and your retailer relationships, through understanding deep consumer needs. The ones that they tell you about, and the ones that they don't tell you about. And then, finding for where your brand has to plug into their life, as well as stretching to your new people's lives.

Dan: Do you have an example? When you say becoming one of many after you get knocked off, what does that look like, what does that mean, so you can help illustrate what we're talking about? Because as we go further, I know this is critically important to our discussion and to your book.

David: Sure. A really great one that's a great example of somebody getting knocked off is, we had a company come to us who, they are called Dry Soda Company. They make natural soda. Again, I think it's a good, very easy to understand the product. They had grown for about a decade. They helped sort of pioneer the craft soda movement if you will. This is maybe the story I'm talking about is about five years old now. So, they helped pioneer the craft soda movement about 15 years ago, so if you do the math.

When they were one of the pioneers, craft soda was this very culinary thing, and the woman started it because she wanted non-alcoholic beverages to be able to go to cocktail parties, or for expecting moms, or something that was just cleaner and a little bit elegant. Her first thing was like cucumber and lavender, and they were really quite culinary.

But then, the rest of that group that was pioneering craft soda, did like punch you in the face, HOTLIPS Soda, orange, which, if you've ever had, is a gigantic flavor. And so, that actually took over the category. So she found herself competing on price, and made a deal with Kroger and went ... So 26 weeks out of the year, they were 10 for $10 versus something closer to $2.99 for a four-pack at that point. And what they found is that nothing moved when they were on deal.

And so, what happened is that they just proved enough that they could sell when they were on deal, and Kroger went out and made a natural cucumber soda and put it in their private label. So then now, the brand is playing on price against the house brand and losing unless they're on deal. So, that is what I mean. They went from first and only to ... And when they were first and only, they had dominance by default. And then once there was a crowd around them, and the retailers are copying the ideas as well, they became one of many and really struggled.

So, as a result, that brand decided that they would try to compete with big soda, which of course, would be the recipe for death for any entrepreneurial brand. We helped them figure out how to talk to people through the channels they were in, and more importantly, how to talk to their retailers to become an ally and a knowledge estate for the retailers. The knowledge estate being around craft soda and what customers and people want from it. That ended up shifting their entire universe, and they went from, again, one of many to category leadership, and have had profound growth.

Dan: That helps a lot. Thanks. That's what we talked about actually when we had the pre-call. And of course, this is what I talk about a lot, about how to leverage your selling story to help the retailer understand what's unique about that core customer that you're driving into their store. The point being is this, instead of being a commodity, a price-driven commodity, now all of a sudden you're a value add to the retailer because now you're driving in that profitable shopper. You're re-engaging the category. You're revitalizing the category. And more importantly, that core customer that comes into buy that soda is going to buy other products across other categories.

So when you're working with them, how do you help them educate the retailer about this? What do you do to work with the retailer ... work with the brand to help their brand work with the retailer on this mission?

David: Yeah. That is a really good question. It is each time it's bespoke to that client's need, and then their retail channels. But what I want to say is that retail is under immense pressure right now. It's kind of broken. The so-called retail apocalypse has created this pressure on buyers to perform. They need velocity. They need turns.

So, what we always tell the brands we're working with, especially the ones that are entrepreneurial, or just got funding, or they are struggling to meet their velocity hurdles, is that you need to understand you're displacing somebody else. That space on the shelf, the retailer needs you to understand that it needs to turn, and you need to be able to explain to them who's going to touch it, why they're going to touch it, why they're going to ... what else is going to be in their shopping basket, and how you fit into their lives, and how that pulls people to that retail aisle. And, just having that conversation and becoming an ally with them, and being really committed to knowing as much as they do or more about the category that you're playing in.

For example, if you are in the water or any beverage, or if you're in the snack aisle, or if you're in the prepared foods aisle, you need to be somebody that they come to, see as an authority on that category, rather than somebody begging for shelf space.

Dan: That's exactly what we talked about before. This is the focus actually of this podcast. The whole reason this podcast exists is to teach brands exactly what you're talking about. The realities, you mentioned big soda, big soda's struggling. And the reason is, is because they've commoditized themselves. They've gotten down to where it's about price wars. How far down can they fight, how low can they go, in terms of trying to convince customers to buy their products? From my perspective, it's sort of manipulation in that, a false belief that if they can lower their price enough people are going to buy it. No matter what's in the product, no matter where the sugar came from, all that other stuff, whole another conversation. But point is, educating the retailer about that unique consumer.

I want to go one step further. You said that retail is kind of broken. I believe it is broken. And the reason I believe it's broken is because of this. If we can change the retail environment by helping those unique brands, those disruptive brands that cater to those customers, those unique customers that know, like, and trust what they want, they want quality over price, that's going to change the conversation.

You mentioned that comment about velocity. That's another myth. As a brand, you're taught that velocity is the only thing that matters. The reality is that profit matters more. The reality is that your contribution to the category. So, I'd love to actually discuss this with you is, I believe that brands need to focus on their contribution to the category and not their velocity. And what I mean by that, is that for a big brand to come in and buy volume, by spending a lot of money on promotions, buying the price down, et cetera, yeah, they're going to get a sales spike a little bit. But, it's like a sugar high. It wears off real quick. As soon as that promotion's over, then people stop buying.

Or in a lot of categories, in a lot of situations, you're smiling so you know what I'm talking about, where customers are smart enough to know, "Well, you know, every four weeks or three weeks or whatever this item's going to be on sale. I'm just going to wait, then I'm going to load up, and then I don't have to come back." So, what are your thoughts around that? And then, how would you help a brand understand this dynamic and then leverage the value of their customer with that retailer?

David: Well, I think, again, it comes back to really understanding your customer, your consumer, and understanding their deep needs and why and how you fit into their life. This is something that brands that have a mission and a passion and a purpose, and have a triple bottom line are much, much better at. And those are the brands that we love to help because they're the ones committed to disrupting the apple cart if you will.

How do we help them to communicate with their retailer is, you're right, velocity is one component. But that is what the retailer's looking at. What you're talking about is you need to help them make money, you need to help them have margin themselves. And in order to do that, you have to have margin yourself so that you can be there next year. So, that is a really important component. It's really understanding how you make what you make and pricing it in a way that will work for your consumer, and leave enough margin for your organization and for the retailer.

It's completely different than a multinational buying, paying the slotting fees and getting the shelf space and getting in there. We have a client right now that is working with Target. They have what I will say is a brand that has disrupted a pretty heavily commoditized space. It's actually a water brand. It's called Essentia Water. They are alkaline water. They are growing by leaps and bounds, and they have just started national advertising. But, that is pulling people in, but the brand is trying to figure out how to communicate their value proposition and the thing that consumers love about them and rave about them, to national chains like Target in a way that will work for the big system at Target. It's a learning curve for them.

Dan: It is. Well, and thank you for sharing that example. This is why I do what I do. And actually, this is the framework. We're going to talk about your book in a minute because I'm thrilled about the fact you've got one, you've come on. But this is exactly why I built my free Turnkey Sales Story Strategies course. David, I've been in big CBG for years now. I've been working with small brands for at least a dozen years. The point is this, there is a belief that this is the way you do things. And the reality is that that way is broken.

And so, when we start talking about the commoditization of the consumer, of the retailer, of the products, et cetera, the brands, the challenge is that it helps those retailers, it makes those retailers irrelevant. What I mean by that, there's a competitive thread out there, actually several of them in your neighborhood, you know this well, Amazon or Jet, or any of those online suppliers. Or any other retailers in any other marketplace.

My point is this, instead of trying to reacquire the same customer over and over and over again, as every retailer does today, if you can help the retailer remain relevant by helping the brand help the retailer give their shoppers what they want, at the end of the day that's how you change that conversation. The reality is that I have a loyalty card for every airline I fly on, for every retailer in my market.

If Essentia in this example can help the retailer understand what's unique about their brand, the customer that buys the brand, when their brand goes into the store what else do they buy, et cetera, and then leverage that in their selling story, that's how you help the Targets, the Krogers, the everybody else remain relevant so that as a customer you're not ... as a retailer not inviting me to go shop your competition. Your thoughts?

David: I agree with you completely that that is a problem, and the challenge, and the opportunity all in a nutshell. And so if you think about using Essentia as an example, we know their customers really deeply, that they are at the point in their life regardless of which age segment they live in, they're in their life saying, "I'm motivated to change. I'm motivated to be the best version of myself, and these are kinds of things I want. That that is I want to put on my uniform if you will."

And so, it attracts a hungrier, younger, more optimistic, committed to natural, willing to part with dollars even if they are not in that ideal income bracket, they understand the value of these natural products. It's that kind of understanding that helps that brand be attractive to someone like Target, who is midstream on trying to make a clean and natural part of their world because they see that that's the way the world is going.

Dan: True.

David: And so-

Dan: Go ahead.

David: I was just going to say for Target to want to talk to Essentia is smart business on their behalf, and they can learn a lot about the idiosyncrasies and the shopping behaviors and the need states of this younger, millennial-minded cohort who wants and needs certain things that may or may not get through what is currently on that shelf of water at Target, such Evian or Smartwater or Dasani or any of the big brands. So, those brands don't have the same kind of insight into this desired new consumer. So, having Essentia there helps give credibility to Target's movement to try to be more clean and natural.

Dan: What I was going to say, and thank you for sharing that, is that the problem that you're running into, the problem that I see you running into, and the problem that every other brand runs into is that when you're talking to Target, Kroger, doesn't matter who it is, they tend to commoditize that shopper. They don't understand what's unique about that shopper.

Here's an example that I give a lot. If I eat the generic bread, I'm hungry almost immediately. If I eat the best mainstream bread, whole grain, et cetera, I may be satiated for three or four hours. However, if you are what you eat and what you eat matters, if you believe that then if I spend an extra 52 cents at shelf or whatever to buy the organic bread that has the more nutrients in it, et cetera, that fuels my body longer, then that's cheaper in the long run for me as a consumer. Something I think we as an industry need to do a better job communicating. But more importantly, that consumer, that unique consumer that understands that.

So going into the water space, if you're talking about the alkalinity, you're talking about the purity, you're talking about the consumer that buys it. The consumer that knows, likes, and trusts the brand beyond the four corners of the package or the bottle in this case, and the customer that understands that if they drink this water, they're going to be refreshed and they're going to be satiated. Satiated is probably the wrong word. Hydrated properly, et cetera, then, that's a big difference. Versus the consumer that spends X dollars to buy bottled water that comes from a tap, or maybe goes through a city filtering or whatever.

My point is this. The conversation needs to go way beyond what customers, what brands ... way beyond the conversation that brands have with the retailers today. We need to work harder as an industry to educate the retailers about why this consumer matters. So, if I'm an Essentia customer, which I am, and I buy Essentia Water, what are the other things that I buy? And then why do I buy them, why do they matter? Those are the things that I believe that we need to help retailers understand. I think that's a critical part of your selling story. I know that we're going to talk about your book in a minute, but when we talked yesterday, these are some of the things that we talked about. Can you add to that? What are your thoughts?

David: I agree with you completely. It is incumbent upon the brand owner and the entrepreneur and the food business to help educate the retailer. When you get both of those happening, coming from both the retail side and from the brand side, you help enlighten all the consumers and you push this change that is happening. You get people to understand you are what you eat. You put good in, you get good out. And that farming matters, and that process matters, and sustainability matters, and your packaging matters. Not just what it looks like, but what it's made of. And that there are constant trade-offs in those things.

But you can come to the table and explain to your retailer that you get this, you're going to be an ally and a trusted resource, rather than somebody they're trying to slot in. And they'll also be, while there is a business case behind all of this, they'll be more your ally and try to help you make sure that there's margin in your product, and make sure that you will be around next year so that you can have a partnership rather than a vendor relationship.

Dan: Absolutely. It's so critically important, like you said, education. I believe that every opportunity that you have to work with a retailer needs to be an educational opportunity. An opportunity for you to help educate the retailer about your unique consumer, how they shop the category, what else they buy, et cetera.

I want to go one step further. One of the main components of that course, the free Turnkey Sales Story Strategies course, is about how you communicate that message. Let me explain. If I tell you a story, and then you share it with someone else, and they share it with someone else and so on, by the time it comes back around to me it's unrecognizable. This is the Achilles heel, literally, of every brand that's out there.

If Essentia Water, if you, if any brand out there can go in and tell the same story with the same passion and enthusiasm as the founder does, you're in lockstep, you've got a significant competitive advantage. So when you're talking to Target, don't tell them a story that's different from Kroger, that's different from whoever else, or Fred Meyer actually, in your backyard. So my point is that if we can help the brands leverage these strategies, that's how they help the retailer remain relevant against their competitive threats. Any idea, any more comments you want to share about that?

David: Well, I just want to first say hallelujah. That's exactly it. That is our whole business model. We started saying, yeah, you can go anywhere and get some packaging that's going to pop on shelves. That design, as it is, has completely commoditized. But getting your organization literally on the same page and singing from the same libretto so that the words that come out of your mouth are the same, whether you're the CEO or the hired street team in another city, that is exactly the same, and that all of your sales and retail presentations are as good as if the founder were there because it's one voice, that becomes radically differentiating. If you can do that in a way, and then it maps back to your retailers so that they're saying the same things about you, and your consumers are saying the same things about you, you have an unfair advantage and we actually call that a cult brand. That's what we specialize in.

Dan: Perfect. Yeah. Thank you for sharing that. I mean, that's so important. I work with a lot of brands from emerging to multi-billion dollar brands. I work with a lot of the brands that are getting ready to pitch. So as an industry and I shared this with you a little bit yesterday, we're excellent as an industry at teaching you how to raise money. Then we teach to raise money, then we teach you to raise money. And then we're going to teach you how to raise money, and when you get in front of a retailer it's shut up, sit down, get out your checkbook. And I'm being a little bit sarcastic.

But here's one of the things I think is a great segue into your book, is that I've never heard a brand say, "You know what? Our brand is just like the leading brand on the shelf. We use the same packaging and everything else." The reality is that you as a brand expert, if you went to any brand out there, like Essentia, it doesn't matter, and said, "You know what? You're doing it wrong. You need to have the same three-color formula. You need to have the same font. You need to be in the same bottle. Everything else." They would be offended and for good reason. But then those same brands will go out and use the same cookie-cutter strategies that did not work for their great-grandfather. I don't understand it.

So that's where we come in, and that's why framing this conversation, and thank you for sharing your personal story at the beginning, you get it. You understand it. You understand that food is medicine. Food is a lot more than just a commodity. It is life-giving. It is what fuels us throughout the day if we eat the proper nutrients, et cetera. The point being is, being able to communicate those values, those missions within the foods, that's so critically important.

You wrote a book. Can you talk a little bit about that, what was the goal, and what were you hoping to achieve? Because I think what we've been talking about leads nicely into what your book is about.

David: Sure. Well, I wrote the book because I felt like this idea we had 10 years ago, that we could help the do-gooders change the food and beverage and fitness and wellness space for the better, and make these ideas of organic, and clean, and nutritionally dense, and sustainable farming, and clean practices, we could help normalize that. That was our idea 10 years ago.

The book is because in the last seven years we've seen all of the reasons we set out on our mission to change the world for the better and help those who were intent on doing that actually get some traction and have world-class tools, we felt like it was time to put the tools, one set of the tools out in front of the CEOs, the CMOs, the investors, and entrepreneurs, so that they could figure out how to play the game against giant, well-funded brands that they would be competing with.

Because, the multinationals have gotten in the game, and they are now able to play and throw slotting fees and throw dollars at it. And we work with some of them, so we understand that business, as well. We just felt like it was time to put democratize the tools. Give them to everybody so that they can understand how to think beyond 20th-century marketing tactics.

Dan: When you say tools, what do you mean by that? Can you give an example? And then, why does that matter?

David: Yeah. We have this philosophy, the book is really about this brand ecosystem. There are seven conventional musts in marketing, and we have built a ladder where if you start with customer education instead of starting with social media, there's a formula you can use to build a brand that will attract consumers and they will opt into it from a values perspective. Meaning that they will evangelize on your behalf, rather than you having to beg them to try you.

So, the book is really about that. It's about the brand ecosystem to move you from one of many to category prominence. We have used these tools in over 100 cases. I can actually show you a picture in the book.

Dan: Cool.

David: This pyramid right here?

Dan: Yeah.

David: This is a formula. It starts with customer education as the foundation and puts social media as the crown. Where what we see is the cause of the world we live in, most people will overinvest here and do a mediocre job of educating our customers. We have a formula for helping brands figure out how to plug into the needs and lives of humans, will then push their education platform or their evangelical or values-based platform out to the world on behalf of the brand.

Dan: So, what does that look like? And then, how does a brand leverage that? Because you've said a lot, and what I'm getting at is that the notion that if we do what we've always been doing doesn't work, and a lot of people are told, "Well, you know what? You've got to have social media." Where a lot of the brands are told, or of the belief, or they just talk at you. That's what the big brands do. So how do you develop that relationship with that consumer that you want to evangelize your product?

David: Yeah. Well, you have to stand for something, and you have to figure out a way to get your values expressed and help them understand everything about why you created your product, why your brand exists, what good you're doing in the world besides making a profit, and you need to plug it into their life in a way that is meaningful and useful for them. It can ultimately be Instagram-able, but it doesn't start out that way. There needs to be something more than a pretty face.

And so, that comes down to what are your practices, and how are you going about getting your product to market. There's a story there, and consumers today care. You can use that rather than, "It's just cheese-flavored and tastes great." There's a lot more to it than that. They do want it to taste good. If you say it's going to taste cheesy and delicious, it better. But they want all the other bits as well, because they want to use your brand as a reflection of who they are.

There's this notion that we see happening a lot, which is something again that I love, is that citizen brandhood is happening. And that is actually not because the organizations necessarily had good hearts, it's because this industry is shaking it up, and has connected with an audience who wants brands to have a moral compass because they are using those brands as building blocks of their personal identity in the way that previous generations used religion and universities and social clubs and family. So with all of those things on the decline, brands are the new building blocks of personal identity.

I have social proof of this. I have somebody on my team here who's brilliant at everything they do, and yet confesses they won't buy a mac and cheese unless they've seen it on their friend's Instagram feed.

Dan: Really?

David: Because-

Dan: You know, I've heard stories like that, and that makes sense. I love that the notion brands are the building ... how'd you say that? Brands are the building blocks of your identity. That's perfect. Well said. I really, really like that. Citizen brandhood. What does that mean?

David: Well, it means that humans are looking to brands to be good citizens. Patagonia is the poster child of this. Patagonia has made it very clear that sustainability and environmentalism matter. They've also made it very clear that if you're a dirtbag, which is their tribe, you've got to get out in the dirt and do your thing. That's the most important thing in your life, and you want to make sure that you, your friends, and your progeny have that same opportunity to get out into that dirt. And that is good citizen brandhood.

Dan: Which is so very important. So now going back to what we talked about a minute ago, when you're educating the retailer about what's unique about your product, now you're converting an occasional customer to a loyal evangelist. You mentioned something a minute ago. One of the challenges that I run into when I'm working with brands is that they are the belief. Remember the story a minute ago, where they effectively hand the keys to someone else, or they do what their great-grandfather did. Is that, there's a notion, a myth that the selling stops as soon as the product leaves the warehouse.

Wrong. The selling extends to well beyond after the customer takes it home, shares it with their friends and family, et cetera. To your point, I love that example you just shared, there are a lot of people out there that will only buy products that are verified or validated or whatever. More importantly, when you talk about the early adopter, then you've got to have those key attributes highlighted in terms of the way you communicate the value of the brand.

One of the things I've said for years now, David, is that brands need to communicate beyond the four corners of their package. When I started in this industry, it was the blue box, the green box, whatever. Now customers take it, get on their smartphone and they do research. They want to get on your website. They want to understand about the brand. Why does this nutrient make sense to me, how's it going to help me? Back to your earlier story. Understanding those nutrients, and understanding the quality of the food made a dramatic shift, a dramatic change in the health and wellbeing of those that you loved.

It's these consumers that are your ideal consumer. The consumer that's not going to be price-sensitive ... excuse me ... that's going to go out of their way and spend a super premium to buy the products that actually work and deliver at an extremely high value. You cannot put a price on that in terms of the discount, or any of the traditional strategies won't work with these brands. I mean, maybe work a little bit, but they're not going to help accelerate sales. They're simply going to be a Band-aid.

What customers want is what they want. And if you as a brand agency can help educate a brand as to what that customer wants, how to communicate that to the retailer, that's the home run. So, how does your book tie all this together? And then, share some more anecdotes, if you would.

David: Sure. The book ties this all together by taking what a conventional business score model would have you understand about how the four Ps of marketing work, and it sets it on its head and it adds several more. The four Ps are product, price, place, promotion. We get into purpose, people, planet, purity, production. Those are all sorts of things that are very important to this consumer. So when you can start talking about it like that, you automatically invite them to inspect your citizen brandhood. It's very important.

And I think that the other thing that our model does is, it will talk about something like in-store marketing or in-store experience. We talked about this in our pre-call a little bit. In-store experience, yes, that's your package. Yes, that might be an end cap. Yes, it might be several things. But in reality, it gets back to that relationship with your retailer and to help them understand how you're going to contribute to their citizen brandhood, their pull of these higher, or these change-minded, wellness-minded, premium-focused consumers, and get them in there over and over and over again.

And get those people to evangelize on behalf of, saying things like, "Oh yeah, you should see ... " and I'm going to pull this out of something that I just heard in the office yesterday. It was like, "Oh, my gosh." I'm in Seattle, so down the street, "You should see at Met Market. The end cap of insert brand here is so freaking amazing. You can see that two months ago they had one skew that hardly moved. What happened?"

If you go and inspect the story, they got their story straight and they figured out how to tell it. They aligned their system. They upgraded their packaging, and they worked with the retailer to get placement that was prices not cheaply but as premium so that they are now blowing up a category that they've been sleeping in for a decade.

Dan: That's a great story. And that's why we do what we do, to change the world one brand at a time. Your comment about retailer citizenhood, that's so critically important. And to go back to what you're saying, it's not about the retailer commoditizing the customer and the shoppers they typically do. A lot of the retailer buyers, a lot of the people that work for those retailers are all about how do we make a profit, how do we move forward. They have certain objectives they need to achieve.

Unfortunately, again going back to retail is broken, the focus is instead on making margin on a single item. Instead of doing that, they need to make margin on the entire shopping basket. They need to make margin on every ... excuse me, go beyond margin and start thinking about how does a customer come in their store.

There's a retailer, local, that I went out of my way to shop at for years and years and years. I was extremely loyal to them. They lost my trust recently. It was a stupid little thing, but you know what, it matters and it matters to other people, as well. My point is this, retailers need to be paying attention to the customers that buy the products that are in their stores. They need to make it easier so their customers don't go on a scavenger hunt. They need to promote and support those brands that align with, kind of what you were saying, with their citizen brandhood. And then if they can do that effectively, then they can help retain people as loyal customers. Your thoughts?

David: I agree with you completely. In the Puget Sound, there's a brand here called PCC Natural Market .

Dan: Love them. Yeah, they're great.

David: They are the ultimate citizen brand grocer. In fact, when the Organic Certification Board got put together by the United States government, they invited people from PCC because they are the original hippies who run that coop. But, using their value system of clean, traceability, organic, and taking a stand for all these things that were unpopular throughout the ages that are now getting normalized.

I'm super proud of brands like H-E-B, who is taking this idea of citizen brandhood and talking about attracting a cohort, and making sure it's easy for them to shop. And that education is part of that, and that the whole basket matters, and that there's margin across all basket. They are rocking that.

Dan: Good. Well, it's so important. And, thank you again for sharing this. I know I keep saying that, but we're changing the world one brand at a time, one retailer at a time. And the odd thing is, we're just trying to give customers what they want. That sounds super simple, easy, stupid, whatever. But the point is, this isn't rocket science. But because we've overcomplicated the process, because we've put Wall Street in front of Main Street, because we've focused on the wrong values, margin over single-item versus margin over the long run, over the entire customer, that relationship with the customer. This is why this matters.

I shared with you when we talked before that I interviewed Nona Evans, the former director of Whole Foods on the podcast. She shared that they spent $270 to reacquire a customer. That's ludicrous. First of all, where does that money come from? We, the consumer. How does it come to them? Well, they jack up their prices on the brand, or through margin slotting fees, whatever. Okay?

And my point is, that instead of trying to reacquire the same customer over and over and over and over and over again, doing this is where you become a value-added resource to the retailer, and then this is how you help the retailer convert an occasional customer to a loyal shopper as I said. The benefit of this, and I love the story you just shared a minute ago, is that when retailers are paying attention, savvy retailers, they will reward those brands for helping those brands drive sales and profits, et cetera, in their store. Any anecdotes or any thoughts or ideas around that?

David: Well, I think it's a really important thing for people building and growing the brand from their side to understand that that's the retail reality and the game that you have to step into. I think it's really interesting, and I would say my thoughts around this, we have a client who recently ... Well, in our pre-call, I mentioned how you can be number one at Whole Foods and still not be profitable, which is. But in this particular instance, Whole Foods is a very important customer because their cohort loves that store in certain cities, and on and on and on. And they shop elsewhere, as well.

But in the relationship with Whole Foods, it had gone one way, which is it was Whole Foods and then the brand we were working with down here going, "Please, sir, may I have some more? Please, sir, may I have some more?" And, getting a little traction. It got a little bit better over time. And then they developed this new product that was all sustainable and organic, and clean and amazing. It became this really interesting opportunity for the brand to actually educate Whole Foods on what sustainability truly meant, which blew their minds and changed their relationship forever.

We happened to get to be flies on the wall, which was super cool. It was about this notion of organic, and it was a certain ingredient that there's only so much of on Planet Earth that can be organic. The product tasted so good. It was amazing. And if you can do an organic version, it was a food that would basically be like $20 a bag for something that the next closest thing is like $2.99.

So, in order for it to show up on the shelf at Whole Foods, our client could not make any money. In fact, it would cost them roughly $4.00 a bag to get it on the shelf. Whole Foods was pushing and pushing and pushing that. They found a version of the ingredient that is sustainable and clean and transitional farming, and brought it to Whole Foods and said, "Our profit margin, so that we get to be here next year, should be part of your sustainability story. Not forcing us to produce organic when it's not in the best interest of the consumer or the farmer or our brand."

It was this radical, eye-opening experience. Change the relationship. Now it's this kind of a partnership, rather than this kind of a partnership. The brand is kicking butt at Whole Foods, and everywhere else they go.

Dan: Great story. You made me think of something a minute ago. The Fair Trade Association. I believe in them. I think it's great that they're doing what they're doing, et cetera, but why are we so focused on helping people, farmers, in other countries get a fair wage when we're demanding people that make products and sell them to the Whole Foods in that example, sell them at a loss? It doesn't make any sense. To your point, that's fixing retail. That's fixing the system. Everyone should get paid a fair price.

I have a belief, David, first of all, that CEOs should not be perpetual fundraisers. And then secondly, that a brand should never have to apologize for using quality ingredients in it. Your thoughts?

David: I agree. Earlier on you said we teach them how to raise money. Then we teach them how to raise money, and we teach them how to raise money. That is so true. And while money is a little bit like oxygen, as in if you don't have any you start to lose your head. But, I don't think it's the end all be all. I do think that it's a problem. If it's all about ... well, we'll make that up in the big picture when we get acquired. You're never getting acquired if that's your ...

Dan: No.

David: We have so many brands that come to us that are actually wellness darling brands, that when you sit down and talk to them, there's no profit in there. It's all VC money. That's fine for a couple of years, but there needs to be something where we have a different conversation than ... This is getting back to why do we demand fair trade, and yet we are in reality saying, "Okay. We want you to have that citizen brand. We want the retailer to require there be fair trade. And when push comes to shove, we want the $1.99 version if it's not fair trade." And I think that's a consumer issue.

What I want to say about this is, I think that it's greed. It's greed conflicted with trying to be good humans. I think that if we really understood it better, we would figure out a way to make ingredients matter. We would figure out a way to make sure that there aren't any products filled with crap, that are the cheap knockoff. We would democratize nutritional education and supply chain and sustainability so that everybody started understanding that.

What I want to say about that is I'm super encouraged, because I have children, and I can tell you my 5th grader understands what transitional farming is, understands. And it's not because of me, it's because they're teaching that in school now. They understand the farmer's plight in Central America. And they understand, for example, Starbucks and their commitment to making sure that the coffee farmers have a living wage. Kids understand that. So, I'm encouraged that this generation behind us will stand on our shoulders and do something amazing.

Dan: Great story. Thank you. That's so important that we're starting to teach the youth. I haven't seen that locally, although, I don't have kids. I mean, it's encouraging to hear that that's actually being taught. To take it one step further, you're talking about VCs and dollars, et cetera. By leveraging these stories with them even, then it can help you negotiate better terms as a brand so you can get more runway. A whole nother conversation. But long story short is by leveraging these strategies, we become more than just a commodity.

One of the things I wanted to share with you, I was thinking about while you were saying that is that many, many years ago, there was a certain retailer, not to mention any names, but they decided, hey, we're big enough we're going to start telling the world what we want, what we expect. And so, they reached out to a lot of different brands, and they said we want this product in this size container, et cetera, et cetera, at this price point. A lot of brands went under as a result. Even big national brands that were re-brought, and you still see them around today, but a lot of people don't realize that they went under.

At one point, the brand that I was working for was told that they needed to take, it was Unilever, we were told that we needed to come up with 100-ounce bottle of liquid All, back when we were selling laundry detergent. That was not part of our strategy. It was an allergy-free, it was more of a specialty-type detergent, et cetera. But the retailer said, "No, this is what you're going to do, or you're going to be off our shelf." So, we did it. It derailed the brand. It completely changed the focus of the brand. Instead of being tied to that consumer that understood the benefit of having allergy-free and why that matters et cetera, it became a commodity. And it dramatically negatively impacted the brand as a result.

To your point, brands need to stand their ground. They need to be able to have that honest, one on one relationship, partnership, but one on one relationship with their retailer, where they're communicating this to help the retailer understand that, "Look, I'd really like to help you. I'd like to support you. But, five promotions a year at that deep of a discount, I can't do that but I can do three, and I can add in these other things." Or, to your point, "If I give away $4.00 profit on every bag, then I'm not going to be here next year so none of this matters."

Thank you for sharing, and great stories, by the way. Can you tell us a little bit more about the book, things that you haven't shared yet that you want to make sure that we talk about today?

David: Yeah. The book itself, again, it's Beloved and Dominant Brands, and it's about the brand ecosystem to help you move from one of many to category prominence. The book is really a self-guided brand and category audit. There are appropriately 5 to 10 questions at the end of each chapter that will help you conduct your own audit of your situation. I assure you they're questions that you have probably never asked yourself as a brand owner or as a CMO. Those questions will change the world for you by helping you start to have conversations, like the conversation that we've had today. Start figuring out how your value system plays into the retailer's value system, and how that can be a partnership rather than a transaction. Each chapter's filled with ways to identify how to do that for yourself.

Dan: Good. I love that. It goes back to what we were saying a minute ago, where if you as a branding expert were to say, "You're doing it wrong. You need to be the same three-color formula," that whole bit. Why do brands continue to follow along the path of what everyone else is doing? If you want to differentiate yourself, if you want to stand out on a crowded shelf, you can't use the same strategies that everyone else uses.

If you're a dog food, the strategies you use are going to be different. The reports you're going to use, the insights are going to be different than if you're a baby food, or pasta, or a snack, or water, or anything else. Critically important that brands start thinking more strategically about why this matters.

Actually, that's why I started writing my articles many years ago, and that's, again, why we do what we do. Thank you for sharing that. Can you please tell us how do we get ahold of the book? How do we learn more about Retail Voodoo, and anything more you want to share?

David: Great. Retail Voodoo has a website. You can go there. We publish bi-monthly articles. There are podcasts like this that will be available there. The book, there's a website for the book, Beloved and Dominant Brands. You can also buy it on Amazon as a print book or as a Kindle book. There's some talk about doing an audiobook. We'll see how that goes.

What I would say about what we're doing is, we are a really narrowly focused, passionately committed, almost like a resurrected agency where we are feeling like we're just getting started in our 30th year.

Dan: I love that. Just getting started. A 30-year overnight success. Love that subject. I'll be certain to put a link to the book and to Retail Voodoo on the show notes, and on the podcast webpage. One of the things that I offered, if you'd like to talk about it, is what specific bottleneck to do have when you're working with the brands? What can I help you with?

David: Well, the bottleneck that we see is really understanding that there is no such thing as a quick fix. Meaning, the CMO, the CEO, the acquiring venture capitalist or equity partner comes in and says, "I need a solution, and I need to be in market in three months," with whatever it is. they're looking for a quick fix. And then they also don't want to give it time to prove whether it's going to work.

What I tell people is it's going to take one to two years for you to know that whatever you did was a really amazing idea. And that feels dangerous and edgy if you are playing poker with big dollars trying to flip it fast. If you really are in the brand building and brand growing business, time, you have to give it time because you have to find a way to make a promise, decide how you're going to keep it, and then let me, your retail partner, and your consumer see that you kept a promise and then develop an opinion about the way in which you did it. That is really what brand is about. So, patience, I think patience and perspective are the bottleneck that we run into regularly.

Dan: Could not agree with you more. I have the exact same problem. Every brand I talk to, just because your mom likes it doesn't mean everyone else will. The perfect analogy here. The challenge that I run into is that we live in a society where everyone wants what they want right away. In my world, the brands were taught to rely on what I call canned topline reports, push-button category management as I would say.

So in other words, if you're trying to understand water or whatever category you're playing in, here it is, this is what's going on, it's all about velocity. That's not going to tell you the story. So, it goes back to that educational piece of having people back up and understands why this matters. To answer your question, that's why I built that free course, the Turnkey Sales Story Strategies course because it's the foundation of every brand.

The reality is that every single brand I've ever encountered runs into this same problem. The benefit is, is that throughout my career my success, my secret sauce, has been built on leveraging those strategies throughout retail to gain huge, huge, huge incremental distribution, huge profits, huge growth every quarter, et cetera. But to your point, it is more than just a quick fix. But if you understand the basics, then that's what's critically important.

There's a story. I know I'm going to butcher it. So, the story was, and I wish I remembered exactly how it went, but there were two horses. One of the horses won hundreds of times more than the horse that, the second-place horse. And so, the notion was that that second-place horse was not 100 times slower than the first-place horse, the first place horse was only faster by a nose. And because of that, the prize earnings, the winnings, were exponentially higher.

My point is that, to what you're asking about, are brands need to be working on this every single day. We need to not lose sight of the mission. I'm not a football expert, but I love the story about ... Yeah, I see that. The Broncos. Anyhow, so the point is that Vince Lombardi, I love the story about every year he'd show up and say, "Gentlemen, this is a football." One of the most winningest coaches at the time. That's where we need to be as a brand. We need to not lose sight of the basics. We need to get a healthy foundation, and we need to build upon it every day.

To answer your question, this is where we need to change retail. We need to get away from that quick sugar high that is the margin on a single item, that is the price-driven commodity, that is a promotion that doesn't make sense, et cetera, et cetera, et cetera, and focus on what really matters. What really matters is that unique consumer that will go out of their way to spend a premium product in your store if you make it easy for them to buy it. And then how that unique consumer will shop other categories and spend more money.

To your point, how do you help communicate that, convey that with customers? With your customers meaning your brands. It's all about education. Educate brands, help you help educate the brands, or how to educate the retail partners on what's unique about their product, what's unique about the customer.

One of the things you said earlier, and I agree with you wholeheartedly, they've got to become an expert in the category. This goes beyond any top-line category reports. It goes beyond any consumer panel stuff. It goes beyond everything else. Let me put it this way, David, if you had an opportunity as a brand to physically ask every customer that bought your product why did you buy it, why did you use it, why did you choose ours over the other product, why did you choose the other product over ours, et cetera, and ask them why they choose the things in their market basket, that's what we should be striving for. That's not a hard thing for us to figure out, but it takes us having the discipline to be able to do this every single day, to build that healthy foundation and start adding on it.

One of the things that I run into a lot is, I mentioned I work with a lot of brands, is sort of a pay me now or later, whether you'll hire me or not, is that it's a lot more expensive, critically important, listen to this everybody. It's a lot more expensive to hire someone like me to come in and fix something that you broke because you didn't do it right from the beginning. If you have that healthy foundation, and then you leverage that foundation, and you start layering on experts like yourself, leveraging on resources like your book, et cetera, that's how you help grow a sustainable brand. That's what determines really how long you're going to be around, whether it be a month, a year, a legacy brand, et cetera. Your thoughts?

David: I could not agree more. I think you're talking about the willingness to roll up your sleeves, get dirty, stay humble, and share in the coauthoring of your story with consumers, with retailers, and being able to turn it in, turn the education around that into deep, meaningful, human need and human conversation, and give the consumers dignity for being part of you. And, give the retailer dignity for being in partnership with you. It's important. So, how do you get all of that? Stay humble.

Dan: Yeah, absolutely. There's another example I was thinking about while we were talking that helps frame this, even going a step further. You've got kids. Imagine if you would, that at two or three years old, you knocked on your neighbor's door and said, "Hi, would you please raise this kid for the next 18 years? By the way, we want them to eat organic and stuff like that. Then I'll come back and get him when I'm finished." That's what a lot of brands do. "Here are the keys to my brand. You manage it. You take care of it. You whatever."

This is your baby. What you put in, you get out. If you help your kids learn, like you said, about transitional farming, et cetera, then they're going to get more out of it. If they understand the value of the food that they're eating, they're going to gravitate towards healthier choices. On and on and on. Think about all the things that you do as a parent to help guide your children. The notion that you can just simply push a button and they're going to grow up a couple of years later, that doesn't make sense. And then, of course, we regret that time. So yeah, you've got to take ownership of your brand, of your brand's story, and I believe, of your brand strategy. It begins with using and leveraging the resources as you shared.

Thank you for sharing about your book. That table of contents really spells out a lot. I'll certainly, like I said, put a link to everything on the podcast show notes and on the webpage. Thank you for your time. Any last parting thoughts?

David: No, Daniel. Thanks for having me. It was a great conversation. I love where we went. I think we talked about things that people need to hear.

Dan: Thank you. I look forward to our next conversation.

David: Yeah, likewise.

Dan: Thanks. I want to thank David for coming on today and sharing his wisdom and his insights. His book is something that you need to check out. It's full of a lot of great information that's going to help you position and grow your brand. David was kind enough to send me several links, including how to get the book and how to learn more about Retail Voodoo. I'll include those with a link to Retail Voodoo on the podcast show notes and on the podcast webpage. The information that he's providing is exactly what you need to know. It's exactly what I talk about on a lot of these podcast episodes, about how to leverage a unique consumer that you have to drive sustainable traffic to your retail partners.

This week's free downloadable guide is Trade Marketing Essentials to Grow and Scale Your Brand. I'm including this because this is the next step. Once you understand and you can identify who that unique consumer is, now you need to be focused on how do you get more runway for your available resources. How do you promote where that consumer shops? We talked a little bit about trade marketing on this podcast, and why it's such a critical aspect of every brand's success.

By leveraging the strategies that we talked about today about your unique shopper with your trade marketing, this is how you stand out on a crowded shelf. This is how you compete more effectively with big brands. Put another way, this is how you level the playing field between them and yourself. You can download these instantly at brandsecretsandstrategies.com/session147. I look forward to seeing you in the next episode.

Retail Voodoo https://www.retail-voodoo.com

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Read what industry leaders are saying about the book, Beloved & Dominant Brands: The brand ecosystem that drives better-for-you brands from one of many to category prominence. https://www.belovedanddominant.com

 

Buy the book: https://www.amazon.com/dp/1734019204/ref=sr_1_1?keywords=beloved+and+dominant+brands+book&qid=1567894574&s=gateway&sr=8-1

 

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Thanks again for joining us today. Make sure to stop over at brandsecretsandstrategies.com for the show notes along with more great brand building articles and resources. Check out my free course Turnkey Sales Story Strategies, your roadmap to success. You can find that on my website or at TurnkeySalesStoryStrategies.com/growsales. Please subscribe to the podcast, leave a review, and recommend it to your friends and colleagues.

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