365 - From Clicks to Bricks: How Digitally Native Brands Go Massive in Retail

26:29And, you know, Papa Tui, W, Tone, you know, they're very much in like the personal care section. But that's a playbook that I remain really bullish on just because it really shows the resonance of retail, the staying power of retail. When you look at valuation of like quality dollars, let's say, to a pro forma, retail is always going to hold more weight than direct to consumer because there's less essentially variables that go into the consistency of that same dollar that's produced. Is producing$1 in retail while it might take longer is, I believe, a higher quality dollar than a dollar produced on direct to consumer.

27:17And that's not just my opinion. that's validated by a lot of the recent exits you've seen in the CPG space is these are large omni-channel brands that have a diversified mix between physical retail and the online channels. And today, it's like you're really seeing this almost hybridized approach of both of those things becoming true of maybe a direct-to-consumer launch happens, but it's not the primary channel. It's not like a D2C native brand. There are parallel pathing retail discussions. Brands that have done this really successfully, I think, are like David or Grooms, these larger, almost future case study brands, which are extremely well-capitalized and with professional operators, of course.

28:10So take those examples with a grain of salt. But I think that hybrid approach of like doing both at the same time is a safe bet for how to build a brand today in 2025. Because again, I want to reiterate is like what I built, the playbook I built at Squatch, that was in 2021. it's in many ways not really relevant to how to scale a business today. And so it's taking the frameworks from that strategy is really what I help brands apply and helping contextualize that and apply it to their specific route to market category, assortment, price point, all of those things is really what, yeah, I just love to do and have the privilege of helping brands to do.

28:57So I hope, yeah, I hope that's helpful.

28:59Martin Forde:Yeah. No, that's super helpful. I think that's spot on in terms of like that sort of hybridized approach. And I think the examples of David and Groon's are really on point where they're kind of everything that they're doing. They're like rocket shipping their DTC stuff, but that's like parlaying into their retail. And then they're rocket shipping their retail, which is parlaying back in their DTC. So it's like it allows both to accelerate the right way and they've got enough capital to to match that scale. But I'm curious, right, for, you know, the brand operator who maybe isn't as well capitalized or doesn't have the experience running the brands looking to run it up and get into retail.

29:41Martin Forde:What does that look like? Do you need to raise money first? Do you shop things around? Like, what does that first retail sale look like? How do you get it? What goes into it? all that good stuff. Yeah. That first major retailer sale is really brand specific. It's hard to answer directly. And so the, um, cause again, I talk about this a lot and this is a lot of what I help brands do is you can't just like spraying prey retail. You can't just kind of be like, I'm going to talk to whole foods, sprouts, target, Walmart, and CVS. And I'll see which ones take me and I'll go there. A lot of that was the approach that a lot of brands took in when Target was having its heyday of bringing on all these small kind of non-resident brands that really had no business being in retail for the first place.

30:33And then you see Target now over correcting in that strategy of they're simplifying their assortment, they're narrowing it, they're going a lot up for larger suppliers specifically. And so, you know, that first retailer

30:49conversation playbook really needs to be a function of like what you are trying to get out of retail. Why are you going to it's one of the first questions I ask brands is why are you going to retail? And why now? And only the brands can really answer that I can help brands answer that. But that should that question, that answer to it informs your strategy of what, yeah, who you actually go to. And so if your consumer is, you know, a Walmart shopper, why the heck are you trying to sell it to Whole Foods? How is that going to be relevant? If you're, you know, a$9 a bag of seed oil-free tortilla chips, why are you trying to pitch this to Walmart when Erewhon is your number one consumer?

31:45And so it's just fundamentally understanding

31:48Martin Forde:who your consumer is, where they shop, is going to be really a critical insight for... That's what I talk and just want people to take away from this. is have the strategy, have the perspective, have a point of view. Because if you're just going into these discussions into a buyer presentation with no real, like just selling on the merits of the brand, and that's it, you're really not going to get very far. Because a buyer sees, they don't really care about your brand. They care about a few things. They want to know, how are you going to move units and move units above my hurdle rates, my minimum for this category?

32:34And how are you going to bring your shop or your consumer into my store rather than someone else's? And so again, it's a fundamental reshift. I think a lot of digitally needed brands have to make when they actually go into retail is how do I speak a different language to these buyers? Because again, brand doesn't almost matter. Like, yes, sure. Matt, like it's important, but the, um, the more resonant is going to be in your tactics, your strategy and your execution. And of course that's where, um, you know, folks like myself has built out, um, built out a, a career and helping, helping brands do that.

33:14Martin Forde:And so what does that look like? Right. You, like you said, you know, you it's not just about having a pretty brand uh it's about how you can help like how are you going to a move units like help that brand that store you kind of break above their average of whatever they're selling in the category and be like what advantages are you giving them it's not just like oh like now i'm in there and i don't have to do anything so what why do you walk us through i guess what does that buyer process look like right like where do you go obviously every retailer, it's a little different, but like, you know, people talk about these buyers and finding these buyers, where are these buyers?

33:54Martin Forde:How do you get, you know, in front of them? What does a pitch look like and how long are we talking? Like if you have a successful pitch, like what, then what? All of that stuff. Cool. Yeah. Let's, let's talk about the way to fundamentally approach a retailer, a buyer in 2025, because there's, there's a lot of different ways to do so. The first is, you know, reaching out to a buyer yourself, you can do some research on LinkedIn, you can, you know, find some emails, there's like all these crazy scraping tools that like, help, help find that. That's one approach. And I'll explain the merits and risks to each the other is, you know, some buyers, depending on the account, depending on the brand, will actually reach out to a brand some that's how some brands have gotten on shelf at Target is like, Oh, like, I'm looking for I have a gap in my assortment, I'm looking for this type of brands?

34:44Like, will you have a line review discussion with me? And the third is obviously what I facilitate and help brands do is you hire a trusted partner, an operator, a broker who helps represent your brand, has established relationships, has established connections of any of the retailers that you might be considering. And you go into that retailer from a place of strength and go into that. That's really the advantages of hiring a representation for your business is you get a trusted operator who has just knows how to talk to retailers because that, I guess we talked about earlier there, again, there's three tactics.

35:22The problem of reaching out directly to a buyer yourself is, um, well, you, you might kind of piss them off. Like they get it. Buyers are inundated with brands and reach outs and you might not get a response. You might get a response depends on, on how your outreach is, honestly. And if, if it's actually a need, but I've, I've seen that approach do in many ways a lot more harm than good. Obviously, if you get some inbound from a buyer themselves, that's great. Have the conversation, but also don't let the tail wag the dog of like, oh, I need to launch in Whole Foods because the Whole Foods buyer hit me up.

35:58Martin Forde:This is a secret, guys, is you can always say no to a retailer. And how you say no is just as important as how you say yes. You can say no, like, hey, listen, we are not ready to invest in the supply chain necessary to service this business, or we need to make more investments in our pack design to ensure that we have the best presence on shelf. Have a rationale and also a plan for how to come about this because you can always resubmit. And if anything, you're going to be in a place of strength when you go and resubmit for that opportunity. is, so again, I always caution people who have had a buyer reach out to them directly is, is make sure you're ready.

36:41Make sure that this, this doesn't change anything about the fundamental execution you need to have ready for brands. And then of course the third approach is hiring somebody like myself is, is you know, a lot of the value of the brokerage space is much, goes much beyond just setting up a meeting. If that's all your broker does, you should really kind of have a hard conversation with them of like what value you actually providing beyond this. Because fundamentally, what a good partner should help you do is commercialize and scale up your business, is how to operationalize, how to really integrate with a retailer, how to set up all the reporting, how to do all the, you know, set up with distributors, how to do all of the new item paperwork, how to set up retailer promotions, all these crazy things that you have to figure out how to do as a brand.

37:37Yeah, it always helps having some perspective of folks who have done it multiple, multiple times across multiple categories and know the pitfalls and things to watch out for. And yeah, I think the intention behind starting what we build at Highline is really recognition that this brokerage model is fundamentally broken and needs to change. A lot of other brokers in the space aren't partners to brands. They really don't invest in the brands. They don't believe in the brands. And so that's really where we differentiate ourselves is we go a lot deeper rather than wide. We're not throwing spaghetti at the wall and seeing what sticks.

38:19We're investing in brands that we believe in, that we know will work, and helping them give the strategy, the tactics, the approach to be able to approach retail in the most strategic and impactful way. And so that's kind of the three ways you can talk to a buyer. And then again, we can have a long discussion about what scaling up from there actually looks like or some of the tactics that you should utilize when talking to some of those buyers. But yeah, it's always a, a, um, a very, there's a lot of different tactics you can use to be successful in retail.

38:57Martin Forde:So, all right, well, let's, let's go for them. Let's go for the tactics. Let's, let's, I, first, I want to talk about you guys, Highline, your approach to that sort of stuff and what it means to work with a brokerage. I think a lot of people, when they hear, you know, brokerage, they, you know, like maybe some are really good. Some are not so good, like you had just alluded to. What does a deal look like? You know, I think we understand if you're in a position, you're running a brand and you're like, look, I want to move fast. I want to do this the right way. I haven't done this before. Or you want to work with someone that you can trust, but who's got the relationships, who can kind of help, you know, put you on that fast track to success in retail.

39:41Martin Forde:But what does it entail? How do brokerages work? How are they structured? And, you know, once we chat through that, then we can go into all the specifics that you had talked about. So let me provide an overview of the best ways brands can evaluate a prospective broker partner to work with their business. because I say that as that's fundamentally what you are hiring is a partner in the business. And the best brokers are partners, full extensions of your team, hatching on your behalf in your best interests. And so the way that you can kind of, the way I have built out successful broker networks in the past is really finding specialists.

40:27Finding specialists who, and you can specialize in a lot of different ways. is you can specialize by account. You can specialize by category. You can specialize by maybe the type of brand. And so what we specialize in is, again, emerging brands, brands that are net new to retail. And that has been our specialty. And then we have some subspecialty of retailers that we're particularly strong in, of course. But that's always been one criteria. Something I always ask is like, what is your differentiation? How are you different from Joe Schmo broker across the street. The other one, and I'm not going to name names here, but it's really, I've had a lot of success building out partnerships with what's just described as a more boutique approach.

41:17And so really what that is, is usually a core, you know, you're working directly with the founder, like you get to do with myself. They don't have a massive team of like a bunch of VPs and account managers and all these things out. Because again, the problem with the larger shops is you might get like sold to and like, oh, here's all the relationships we have and the ways that we can support your business, yada, yada, yada. But then as soon as you are signed is you're just farmed out to, yeah, a pretty junior account manager has maybe been a buyer for a few years, doesn't have anywhere near the resonance and depth of relationships required to actually be successful.

42:00Um, and a lot of this, like evaluating a, a, a prospective broker partner comes down to again, like, what is it you are seeking to do in retail and how, how can you communicate that to your partner of like, no, I'm trying to use retail as a way to acquire new consumers. I'm trying to use retail as a way to grow top line. I want to use retail because I'm trying to get acquired by Unilever. And that's the only way that they actually make investments. And, you know, I can't be digitally only. I can't be a DTC only brand if that's my end destination. And so, again, understanding the why, the strategy behind all of this should always roll up to who your partner actually is.

42:46And again, always I encourage everybody who's evaluating partners to just talk to a lot of folks, you know, and I have referrals. I'm, I'm, I'm, there's, there's, there's plenty of, uh, great partners, friends in the industry who, who I connect that do, uh, you know, specialize in areas which I'll never even begin to touch. And so, um, that's, what's so great about, um, once you're, once you kind of get in network with a, a few resonance, good partners is you can just kind of play the referral game. And, um, yeah. Who do you know that covers, uh, uh, the convenience channel? Who do you know that covers drug?

43:23Who do you know that covers, um, Costco, you know, like those are, I get these types of questions all the time. And so, um, and you know, over my, my years in the industry and, um, uh, my partners as well as we just have those relationships and have those trusted partners to be able to, yeah, help do right by the brands. Because again, I think that's, that's what, again, fundamentally sets us apart is we are investing in the success of the brands that we bring on, we're not just viewing them as a number, another client number 27 or something like that. So yeah, it's really, again, deep rather than wide is our intent, our strategy.

44:02Martin Forde:So what does it look like though from a pricing and deal structure point of view, right? I think one of the interesting things with this market, it's like getting in the right retailer can legitimately change the complete trajectory of a company, right? I think that's a given you see brands that like I had mentioned that are like doing decent and then all of a sudden they get plugged in at a Whole Foods or a Sprouts they appear well on shelf they've got like a good supply chain they raise some capital and the next thing you know like they're exiting at like an 8x multiple for a billion dollars and you're like whoa that was sweet so like obviously it can definitely accelerate things but when you look at deals like how do things work?

44:46Martin Forde:You know, retainer, brokerage fee, like what does it look like, you know, for you guys? And also when people are evaluating the landscape, like how does it work and how should they think about structuring a brokerage deal to, you know, make it work for everyone involved? Yeah. Having a tight contract is going to be one of the biggest indicators of success of a good broker brand partnership. And so, you know, the, the model that's really typical for any retail broker is going to be a combination of a retainer and commission, some function of those two. Um, some brokers specialize in commission only, and that's, you know, that if you hire a broker going with that model, just know you might be maybe the spaghetti against the wall kind of approach.

45:38You're not really going to get the service level that you would maybe need or expect because there's 50 other brands in the portfolio, some of which are already paying the commission checks. So again, I'm always pretty skeptical of the commission only model just because it doesn't necessarily align incentives. the function of a retainer is really just time. And so I think like a big shift for a lot of digital brands for them to understand is retailer timelines take a really long time. Like from when you start conversations to when you get on shelf, it's anywhere from nine to 12 months. That's the timeline that you should really be expecting.

46:23And so when you think about the partner, again, this is a partner, somebody that you are is investing in your business, is an extension of your team, that part needs to be compensated in some way. It can't defer compensation for nine, 12 months down the road. And if they do, you're probably not going to get, again, that level of service that you might expect. And so the way we build our agreements is really meeting brands where they're at. And that's fundamentally what I think needs to change within this model is so many brokers today just have their contracts, have their templates, have the way it's working, take it or leave it.

46:57And so we really scale up our function. Really, our model is based on, again, meeting brands with what their needs are, not charging them for what they don't need versus what they do. And so maybe that's a really narrow scope retailer covering just Walmart. Maybe that's a super broad, all-encompassing scope covering mash retail, grocery, club, everything. It just depends on what the brand's needs and strategies are. And so that is really what I encourage brands to take a hard look at is, you know, understand what it is you are paying for and how to actually align incentives. The commission model, I think, is really straightforward because obviously you're not really getting paid until the brand actually physically gets on shelf in retail.

47:54I think that aligns incentives from the broker brand really cleanly. And yeah, the approach and really partnership with any brand and broker needs to be between, yeah, needs to be with that of, again, aligning incentives so that both parties are clear on what each of them will need to be successful. Like, for example, we're putting into our agreements is like in order to proceed with retailer submissions, we need our onboarding documents completed so that we even have the materials to be able to represent the brand. I've had engagements kick off where it takes three months to get a sales deck for the brand.

48:39And like, oh, we don't have one yet. We don't know. Like we're working on it. And it's like, guys, we're sitting on our hands right now until we can actually like have a narrative that we can submit to Whole Foods or whatever the account actually is. And so, yeah, it's it's it's a partnership. And that's what I really want to reiterate is like broker brands relationships are really partnerships at the end of the day. And so invest in somebody you believe you can partner with, invest in somebody you believe you can have a relationship with long term because, yeah, invest in the people. That's what I love about consumer is it really is fundamentally a people industry.

49:13It's built by people, people buy the brands. It's really a cool industry in that regard. And so, you know, that's my brief love letter to CPG at large. But I hope that answers your question.

49:27Martin Forde:No, no, definitely, definitely. And I think the models, I think it is really interesting what you say in terms of the different models, especially commission only. Commission only could sound really good. You're like, oh, nothing to lose. But like, you know, on the other side of it, that might mean like you're not getting the actual focus you want and they're throwing a bunch of stuff at the wall and maybe it hits, but like also maybe it doesn't. And then if it does hit, you're out for a bigger fee than you probably would have been if you just hit the retainer anyway. So I think that's that's pretty cool insight there.

49:57Martin Forde:And now I want to talk about like lastly, you know, you do have a lot of insights from being in these meetings, doing the pitches, knowing the materials that they sort of need. you know we just talked a little bit you alluded to the buying cycle how long it actually takes before you get in shelf but like you know when you're sitting down with the buyer you know what materials do you need what does that deck look like i know we touched on it a little bit but like walk me through what the process now looks like to actually land get in and succeed yep and that's gonna again i'm gonna answer of the process to land in a retailer the narrative the deck There's no magic deck structure that's going to immediately get you on shelf at a Walmart because so much of the success of retail is really a function of, you know, category dynamics.

50:50So what is the, you know, what, what white space do you fill within this category? And how do you, the brand fill that, that white space? That's, I think, one of the biggest questions.

51:03Martin Forde:I love that because and I think this applies to like all sort of businesses because like there's you know a lot of business builders like they have a lot of ego and they're like I'm making this business but like I fundamentally believe like there's a market and if it's not you building the business like someone else is going to build it because there's a white space there and maybe the brand looks different maybe it's a different name different packaging or whatever but like if there's a white space like someone's going to fill it right and it's your job for it to be you and for your brand. So I think that's like a super spot on take that it's the category dynamics that drive a lot of that.

51:38Martin Forde:Okay, I'll let you keep going. Yeah, no, it's really, again, a function of how do you meet an unmet need in the category today? And how does your brand communicate that to consumers? Both on your pack, both on your merchandising, and both on your trade marketing approach of how you're going to drive traffic, velocity, all these things to that particular retailer. And that's honestly it, guys. That's the big thing. You can talk about the brand story. You can talk about, obviously, what's your assortment? What's your price point? What are the specific tactics you're going to use? All of those things are kind of, again, specific to the brand, specific to the retailer.

52:28But the bigger thing is like, what's the white space? How am I going to drive traffic to, uh, to meet that white space? That's fundamentally what a buy that's again, aligning your messaging, your narrative to a buyer is really understanding what their needs are. What that buyer is accountable for is growing their category, not growing your brand. They're growing the category. And how are you brands going to help me grow this category? How are you going to not take dollars from this other brand that's doing really well and just shift to your brand like you might like that as the brand but like the buyer they don't give a they don't care about that they they don't like that line to their their needs and so how are you incremental how are you driving again a net new consumer to stores that is the key question and the narrative that you should construct as a brand and that's again what what i help people do yeah and all brands can do that

53:24Martin Forde:credibly totally and i think it's what one thing that's super interesting there is like you're saying the buyer isn't necessarily looking for just like a lateral shift and it's like oh i'm going to swap out brand a for brand b sales aren't going to move or whatever it's like how do you get someone who's like walking down that aisle that maybe wasn't even planning on buying that to like be like wait a minute i actually do need that as part of my routine and like um you know one another thing i'd love to kind of unpack with you because you said at the end of the day um you know you as a brand are responsible for, you know, helping drive that traffic.

53:58Martin Forde:But I think there's kind of like a distinction there, because I think you see a lot of brands that are like cult favorite brands that do have the ability through socials and through like the buzz that they've built, they've got like true fans, they can actually drive significant traffic onto shelves. But you also have brands that maybe don't have that social pull, but they've just got like a magic product that when it sits on the shelf, it sticks out, it communicates what needs to be communicated. And the shopper who's walking down the aisle is going to see it and like gravitate towards it. Right.

54:30Martin Forde:So I'd love to talk a little bit about that. Like, are there two ways to approach it? Do you need to be, you know, like you're saying, driving, you know, necessarily your own traffic or is in some cases creating an amazing packaging, an amazing product that has the ability to pop off shelf and draw in the buyers who are just like already in that store. like I'm going to check that out. Like, how does that work? Yeah, to you're talking about two main mechanisms at which you can drive velocity standout on shelf. One of those to your point, Blaine, is going to be the merchandising, how it presents on shelf, where it's on where it is on the shelf.

55:09Maybe if there's a brand block. So if there's like all of the products are grouped together, those are all really important tactics. And having a point of view, having a perspective on what the merchandising tactics are to drive that velocity. And then outside of the shelf, what about the off-shelf? What about an end cap? What about a sidekick? What about a PDQ? What about all these other corrugated options that you can do that are fundamentally merchandising? Those are really, really important tactics to be able to speak credibly about, particularly if you're, again, an at-scale digital brand

55:43Martin Forde:that's eyeing retail for the first time. The second piece that you mentioned is, again, those digital tactics. So how do you activate your consumers and how do you drive them to stores? I think there's so many cool ways and cool service providers that are doing that. I won't name names, but reach out if you need some referrals, but ways that you can, you know, aggregate influencers to do a UGC approach of like, hey, brand XYZ now available at Target and just kind of flooding the, the, and then running those campaigns and the geos that you're at. And so people are just kind of naturally associating, oh, you know, this brand that I really like is on Target.

56:17Maybe next time I'm in Target, I'll find them. Hard to attribute those sales. There's some folks that are trying to do that. But again, that's the value of a digital brand. It's obviously more of a marketing kind of awareness play rather than a direct call to action of click here, buy this now, X, Y, Z. And those reach campaigns are a little bit more cheaper on a cost per impression basis. than just running everything on paid media. So again, there's a lot of different tactics that are introduced, but I think you kind of astutely break them down into two big ones is, yeah, your merchandising as well as your digital tactics.

56:57And those two things together is how you're going to drive velocity at shelf. And there's a lot of different permutations within that

57:03Martin Forde:that are going to be specific to the brand. Sweet. Martin, I'm not going to keep you forever. We covered so much. I know there's more that we'll be able to jam on We can go all the way in on, you know, scaling and retail, finding that scale. Once you're in, how do you like really continue, like you're saying, to drive merchandising? What does it take for a successful launch? But, you know, maybe what we can do is run it back in the future. This was awesome. This was kind of like a crash course on like, how do you get in? Who do you need to know? And for anyone who's listening, Martin, why don't you drop your socials, your connects?

57:41Martin Forde:Where can we find you? Where can we connect with you if we have any more questions? Yeah, best way for you to get in touch with me is on LinkedIn. Just Martin Ford, F-O-R-D-E. There's an E at the end. And you can check out my website, HighlineRetail.com. And you can book time with me there too. I'm happy to always just engage with brands, answer any questions I can. Love just having conversations with folks that are really eyeing retail, maybe for the first time, maybe from a different lens. And yeah, just happy to be of service in whatever way that looks like. So yeah, reach out on LinkedIn, on my website.

58:21And yeah, Blaine, just wanna, again, express my gratitude for the time to speak with you today.

58:27Martin Forde:And yeah, hope it's, I look forward to the next discussion. Appreciate it. Thanks, Martin. Thanks, Blaine. If you enjoyed the show, we'd love your support. A rating and review would go a long way as we continue to host the best builders in DTC and beyond. Follow and subscribe to the show and make sure to check out our show notes where you can find our socials and weekly newsletter. Visit us on dtcpod.com to join our founder community and access resources from every episode. We'll see you on the next pod.