🧠 Plug&Play is a MYTH! Here's why...

Hey there, 

Welcome back for the 22nd edition of Brandish

Your guide to crafting an iconic brand

I hope you’re having an extraordinary weekend with your loved ones!

In this week’s newsletter - I want to share some of my 2023 reflections with you. 

As the year ends, I spend a lot of time reflecting on what went wrong, what went right - and how we will tackle the coming year. 

… and in this newsletter, I want to brain-dump some of my learnings so that you can hopefully learn from them as well. 

Without further ado...

Grab your Brez.

And let’s get right into it!

There’s no such thing as a Plug & Play eCommerce Strategy.

At least ONCE in their career, every eCommerce founder has probably thought… 

“Hmm - I got success with this one brand. I can probably just Plug & Play this exact strategy to a new product and get double the success.” 

Sounds familiar? 

Although it sounds logical, it’s among the most naive things you can believe as a founder. 

I witnessed this first-hand this year when I acquired a coffee brand in hopes of running a “plug and play” strategy and moving our Obvi infrastructure to the new brand. 

After all - the Coffee business (Coffee Over Cardio) and the supplement business (Obvi) had a ton of similarities. 

I felt like I had cracked the code to success. 

Copy & paste the playbook and infrastructure to build one successful brand after the other… 

… but then

I got smacked in the face by reality… 

There are many reasons why, but here are the biggest ones… 

• It doesn’t matter how similar the products are ⇒ if the buyers/consumers are not similar, you will lose.

• You can’t reasonably expect your team to take on an additional workload (in the form of 2 brands) without losing quality on either one or the other. Even if you compensate them ⇒ there’s a risk of their focus being spread too thin. 

  • ** unless they are a unicorn type of employee. And even in this case, your entire team is probably not unicorn employees. Be realistic. 

• Even from a marketing perspective ⇒, everything that works for one brand may fail for another. 

  • This also underlines the importance of taking every piece of advice with a grain of salt (also mine). Every business is different, and you must figure out what works for you.

Every eCommerce brand should think about Retail from day 0 

DTC is cool and all of that… 

But you have to remember that it’s just a distribution channel. 

It’s not a business model. 

One of the biggest trends I saw in the space this year was how many brands started to see how big of an impact retail can have. 

We, ourselves, are included in that bucket of people. 

We had done a bit of Retail here and there - like Vitamin Shoppe and some Mom&Pop retailers…

But we didn’t go HARD on Retail

Until we launched into Walmart…

And now RiteAid in January…

And a few other bigger retailers are coming up… 

I’ve explained in other newsletters why Retail is such an essential play for CPG brands - but for those of you who are new here (Hi, btw) - I want to outline some of the reasons again. 

Profit driver 

Although many people will try to convince you otherwise online, most DTC brands are not first-order profitable on their DTC channel (at scale). 

The best brands (especially within CPG) are breaking even on the first order and making a profit on every sale afterwards. 

The reason for this is simple. 

A) We’re in an extremely competitive environment right now due to a lower barrier to entry in most industries

B) Consumer confidence is low, and people are holding on to their money 

C) Paid advertising is extremely expensive - particularly in the US (International is easier to make first-order profitable) 

That’s why many brands use Retail as their key profit driver and DTC to acquire new customers at scale. 

Brand Awareness 

Secondly - Retail is also great for driving efficiency in your paid advertising. 

The brand awareness you get from Retail - especially if you’re in a big retailer like Walmart- is unmatched. 

So - besides being a profit driver for your brand, it can also strongly influence the profitability of your paid advertising efforts. 

We have seen this ever since launching in 4200 Walmart stores. 

… and we’re hearing the same everywhere. 

It works

Thanks for reading along!

As always, thanks for reading along!

I appreciate you, and I look forward to seeing you again next week!

Cheers!

Ankit