The D2C Don: Growing Purdy & Figg £0 to £40 Million in 3 Years Using Behavioural Science Secrets

38:40And always that second group comes up with a far better photograph than the first group because what they do is they take loads and loads of photos and they learn about what looks good and what doesn't and they keep taking more and more photos and this goes on for weeks and weeks and weeks. And then out of all those photos they take, they go, what's our best one? Well, essentially that's what Meta's doing the whole time with your adverts. So you can create thousands of adverts and Meta will be able to find out which is the best one. What I'm saying is if one's working, why would you change again?

39:12Because, well, that's a more complex question around Meta's signaling. So, I mean, Meta's job, it's North Star's attention. So all they want to do is get more attention, more screen time, more ads. to do that they need to engage their users so they can't show the same thing over and over and over again on their feeds because it's boring your ads people think of ads as like i'm creating a tv advert you're not you're actually creating a bit of content for people to consume during their entertainment time on social media so you need to fit into that and like content on a news feed gets old, it stops getting used.

39:58If you post something on Instagram tomorrow, it will get likes. And then what will they do? What will Meta do with it? They'll cycle it out. I suppose if you look, history doesn't repeat itself. It rhymes. It's like if you go back to the adverts of Heinz in the 50s or fucking McDonald's, McDonald's are revolving their adverts. McDonald's used the same advert every single time. Yeah, it's boring. It's boring. So it's like there's that principle of one. Actually, yeah, brands do reinvent themselves. and then I suppose they all have to reinvent themselves to evolve. But then the thousand is because you've got to, it's not an advert on TV.

40:30It's not an advert on a billboard. It's slotting into people's entertainment time. And I think that's the nuance. And the more you create, the more opportunities you give meta to find spots, to create, to capture value and attention and create customer, you know, create a customer. So you're always trying to like play their game. But also it's just the reality of social media is that content fatigues, gets boring, is cycled out. They're always new content. The key with social media working is new content. It's all newness. Like the feeds are time-based feeds. You see things from the last day. You don't see things from seven days ago.

41:07What are, so digging into the principles of good adverts. So how many adverts do you reckon you've created over the years? 120 ,000? Well, we haven't had this volume forever because we've got a bigger team now. We've got four full-time video editors on our team now. We didn't used to. I would say, yeah, something like probably 50 ,000 ads. Okay, so 50 ,000 adverts. It's like you taking all the pictures around the city for the perfect picture. What would you say are some of the principles of that work in this education yellow brick? Out of the adverts, the thousands that you've done, not that. Yeah, what are some of the principles that work?

41:49Education first. Yeah. So education, entertainment first, leaning into the platform you're using. So if it's a TikTok ad, make it in TikTok style, make it the same way you create an organic piece of content, basically. So the key principle is merging organic and paid into a single strategy. So it's like when you're creating an ad, you're not creating anything different to what you'd maybe post on your feed. Is that like kind of a secret then? That's a key principle. Yeah, it's native. It has to feel native. It has to feel part of the journey. Then there's obvious things like, I mean, we use the AIDA, a thing called AIDA.

42:28So attention, rate, interest, desire, and action. So all of our ads. Wait, AIDA, attention, desire. Attention, interest, desire, and action. So attention rate is what percentage of people stop on their feed for your ad. So if you think you're scrolling, right? Sure. What percentage stop? So we want that to be above 30 % so all that's dictated by is the thumbnail and hook which are the first three seconds So basic principle advertising right but optimizing for that interest average watch time So after you get that hook that stop how long are people saying we always aim for four to five seconds on average?

43:10Is considered like first tier benchmark? So essentially how are you engaging people post hook? Then desire is we use click-through rate. So what percentage of people have enough desire in your product that they're clicking off their social... What's a good click-through rate? We aim for 1.5 % outbound click-through. So that's like off the platform. And then action is buying. So like purchase conversions from that ad. And obviously it's the final step of the funnel. but yeah that framework is a really nice optimization framework because you can get an ad that's really working and then you go oh the attention's a bit low let's improve the hook the interest rates what's the best ad you've ever done with like what what ads have you run that's given you and how much dough have you made off it oh my god we've probably got ads that have spent half a million quid on them you as in that you've made half a million quid uh spent a half million which means they're probably making a million quid on them or a million and a half.

44:12You spent half a million on one ad? Yeah, before we got ads. What does that advert look like? It's just really good. Yeah. It's a really good ad. You've got David Beckham and Victoria Beckham naked fucking spraying it all over their gaff. That'd probably cost you an arm and a leg. It was probably just like a founder story or they worked really well at the beginning. Founder story ads. That's of you and your brother sitting with... Well, yeah, mum and Charlotte. Yeah, that kind of thing. So, I mean, people can go to our ad library and check them out. All video, all, I'm talking about video, by the way, all that stuff.

44:49So, yeah, but all of that is also just part of, sorry, ads and all. In the direct-to-consumer world, it's more about, it's more about your overall messaging and your value perception of your product and how you build that through your ads, your landing pages, your landing page being your website, your social media presence. It's all about honing your message to try and create value and do what we said earlier, which is create a pricing model that can then you can spend against. Scalable pricing model. So that's like the second brick. It's that whole ecosystem of basically content. I mean, think of it as content.

45:35Yeah. What are some of the other psychological value creation or value perception pieces of magic you've learned about because I know you like you I know we both like read shit loads like it's probably a lot of mates but like yeah is there anything else you've you've picked up that it's like wow that that that really works because Hall Mosey talks about Rory Sutherland and it's like you believe what you want to believe so he talks about that feeling of you know when you've done a work I'm not like I do this often but say you've done a run right and you feel absolutely fucked you've done a 5k PB and you know you feel like your lungs feel like tar and your brain's going like if you were to wake up in the middle of the night and feel like that you'd be like what the fuck like you'd think you're dying but if you've done a run because you've got the context because you're actually expecting to feel that you actually probably feel you're wanting to believe that because i've run so hard it's normal to feel this and i've got a pb you actually want to feel that right and it's you know what you want to believe is what you believe that's cool yeah um but if you were to ask over downstairs and get a cost of coffee and i suddenly felt like that in the queue i'd be going what the fuck is going on you believe what you want to believe and i think it's great in the perception of value and i think you know with with the cheapest uh candle most expensive uh cleaning product that's that's that's kind of you playing with the running analogy yeah um is there anything else you've learned about what just value perception in people's head yeah i mean so the other thing is um it's similar to it's a form of anchoring but have you ever heard about the um the hot the cup of hot coffee story the mcdonald's being sued by the woman for hot coffee no no no so when was getting her coffee from mcdonald's drive-through and a boiling cup of coffee was spilt on up and it like third degree burns all over her legs like absolutely fucked right so she sues mcdonald's like historically these this has happened loads of times so the payouts are like five grand two grand 500 quid often like nothing but this payout was 1.2 million quib and so pricing psychologists start to understand like what the fuck happened yeah why why did you get paid out 1.2 million so the the the process the um attorney in the u.s when when they framed the damages claim instead of saying um instead of saying like you know these are the previous burns this is how much they were paid out this is a really bad one you know we should be at double double those ones they said mcdonald sells

48:181.2 million dollars worth of coffee a day globally we think this pair is one day's worth of their global turnover we think she should be paid and damaged one day's worth of the global turnover and that was their that was their claim i think they said they said like three to four days so it was like four four million dollars payout claim based on their global turnover all the coffee they sell and the jurors awarded like half of that and it was like the biggest award ever and it was all about just changing the perception of what the award should be trying to create a mental model in people's minds of the scale of mcdonald's and the scale of their coffee sales and how many cups being sold all the time and this like horrific incident that occurred i've got this thing that i um i'm going to explore with rory sutherland on the next podcast because but I was, and it's kind of linked to this, it's kind of the, I think, when you go to a Michelin star restaurant or a high-end restaurant, the bogs, the toilet in the bogs always smells amazing and the soap is always premium.

49:25So you know you're in a premium restaurant when you go into the toilet, you're like, oh my God, that's, yeah, yeah, yeah. I went to, I don't know if you, I know there's a place called Salinas which is like these hostels around the world. I went to one in Lisbon shithole right but they've they've premiumized it in in interesting value creation ways one way as i was like uh the toilet the shower it smells amazing and the soap is super premium so i was in this pretty bog standard hotel it was a hostel but i was like oh my god this i felt premium all they've done is how easy it value creation is literally just by putting good smelling uh soap and incense in the toilet, the perception goes up like this.

50:07And I really believe, like, if every amount of restaurants in, like, a kind of a mediocre restaurant in London, who could probably, just by putting nicer smelling things in the bog, could put up their prices and just increase the value. But it's just a genius hack. So that's really interesting, yeah. And what's so funny about it is there's no logic to it. Yeah, no logic, yeah. And, like, they've done tests on this, right? So originally, these priceless psychologists, there's a whole industry on this a very big industry all consulting firms make a fortune doing this stuff but they did this test they wanted to see on price anchoring if there was a boomerang effect what do you mean by boomerang effect?

50:49so like if I went so for instance let's take that claim we talked about earlier the coffee claim right if they'd asked for instead of four days of of global turnover for McDonald's coffee, what if they'd asked for 50 days? And they'd said, we want a$50 million payout. Would there be in the jurors' minds a backlash because it's a ridiculous ask? So the jurors go, this is just ridiculous. We're going to go back to the other method, and we're going to look at previous claims, right? So is there like a boomerang effect? So with price anchoring, it's like, if I do a cross out from 500 down to$10. Sorry, so the boomerang effect is almost when it's too big.

51:35Yeah, when the anchoring is too big. No, but the question is, is there a boomerang effect? And what they found is there isn't a boomerang effect. So you can go as big as you want with the anchoring. You can go, we want a$500 billion claim. Okay, there's no boomerang effect. The incremental gain on your actual result goes down as you scale up so like the difference between asking for 50 and asking for 200 billion might only be like 10 grand to the damages because it's getting to the point where the the incremental effect of the anchoring just becomes less and less but there's not this backlash um so say just again this is this is for anyone negotiating life's a negotiation anchoring and I think anchoring is basically to put it into three year old terms it's like say you want say you want to sell something for two quid start high in there and put them in the back of the court right with an amazing shot and you basically say well I want it for two quid let's start at seven or let me put even more like let's anchor really high fucking 20 quid for example like really push the anchor high and they're going to push your anchor back very deeply and then I think I always say it like a game of tennis it's like they're going to push you to the back of the court and expect that but then fucking don't do a drop shot back like really push them back and then you will get into the middle and i think it's a um it's interesting just for straight up negotiation but also for um framing it in people's in people's minds uh of of the perception of value i just find it endlessly fascinating and i think um yeah just i think that the you could easily spruce up a spruce up any restaurant but just making making the bogs clay but people got really so when this all started to come out about anchoring and all that when was this oh this is in the 80s people got really worried about it um in terms of damages for and and jurors doing damages because attorneys are smart and they read and they have very expensive advice and they basically realize you can manipulate jurors juries so it's a massive it becomes a huge problem because you can just anchor and do all these pricing techniques um so a lot of people started to think damages should be awarded by judges not not jurors um so it's like a whole thing it's like a problem basically and um you can use it yeah definitely use it to your advantage the problem with supermarket selling is like there's too much opposing force on your anchoring like well firstly there's no space to anchor right so you can do a discount that's it you can go oh we used to be valued at this now you can buy us for that that's an anchor in a sense i meant more with the retailer yeah yeah so not when you're saying the product to the consumer from the retailer i meant more when you're like negotiating marketing plans no totally but i'm just i'm just talking about in general and um i'm just talking about the space the problem with selling in supermarkets and all this pricing technique is that um there's so many opposing products to you that are valued cheaply okay Yeah, yeah, yeah.

54:36So it's almost like you're surrounded by the marketing you keep. And it's almost like if you're a sheep in a field of sheeps, you have to be like sheeps. You have to price similar to that market. Whereas actually, I suppose what you've done, if Purdy and Fig's in a supermarket and you're saying, oh, I'm a sheep and you're next loads of sheep, then you kind of have to be a sheep and sell it sheep prices. Whereas what you've done here is you've said, fuck that. We're not going to be a sheep. we're going to be a rhino, for example, like a completely different savannah, not in some shitty field in Lincoln.

55:10We're going to be in the South African savannahs. And that's where actually the price of rhinos is fucking expensive. I don't know where I'm going with this, but the price of rhinos, you know, it's scarce, it's valuable. It's much more expensive. Also, then you get the pricing extraction by doing that. So you're a rhino. And then you can actually spend money on creating an incredible product. because the other thing that happens in supermarkets is it's the lowest common denominator space to buy, all about price, right? Price per mil. So the products are made of shit because you have to make them of shit to make any margin on them.

55:43When you come out of that world, you suddenly have this like completely open opportunity where you can actually invest in making cleaning products with beauty ingredients, which is what we've done, essential oils and glitter and things that you just never see in cleaning products that are expensive. And we do that because we have the margin profile on it to do it. So it's allowed us to create a whole other world for cleaning that didn't exist before. We always say we're like the Aesop of cleaning. We are pushing cleaning into a realm that hasn't existed before. I think it's fascinating how you can, yeah, this flight of imagination.

56:22So first brick is business model. Second brick is education through content. the orange brick of this little D2C Lego Lollapalooza house we're trying to build yeah you should read have you read Charlie Munger's poor Charlie's Almanac I haven't read it but I love his inversion theory which I love yeah yeah maybe we can talk about the inversion theory which is his whole thing of I think he's got that talk where he goes how to live a happy life is how to not live a miserable how to live a miserable life so if you avoid wisdom is prevention you look you know what to avoid you'll get the result you want so it's like i think he says don't live a life of um if you want to live a life of uh miserably miserably be unreliable is one uh be envious is two so if you avoid those things you'll be happy let's do inversion with this like if you wanted to say i want say you wanted to absolutely fuck your business uh in that early stage in fact actually let's just do it now yeah because i talk about early stage say you wanted to absolutely just commit brand aside and uh and and fuck this thing what would you do um so i so i think so that there are three there are three like levers for us as a company right so we've got products yep we've got channels and we've got markets right Those are the three ways we will grow.

57:54So we'll either take countering to other - When you say markets, that's other countries. Yeah, other countries, other territories. We'll either push it into new channels, wholesale, retail, or we'll extend the product line and create more TAM doing that. Those are our - Oh, fuck me, another analogy here. Like adjustable market. Total adjustable market. Yeah, yeah, yeah. I've heard that before, actually. So those are all like, and it's a really good framework for people if you're just trying to think about how to grow your company. It's like those levers, that's it. so choose one if I really wanted to fuck up herdy and fig I would I would do all three at the same time which is basically what people most people do with their brands is they is they push into new markets new channels new products all at once the business becomes very at this stage when we get bigger the business becomes very unfocused and bloated because all these different things compete with each other for time and resource and the business loses that what startup really is is it's but why why can we create purdy and fig get it to 40 million quid when there's unilever rackets with r &d budgets in the billions per year on creating new cleaning products like how can that happen and the answer is because a few people who are very focused on a very specific problem can achieve much like more than a lot of people unfocused doing loads of things and so what tends to happen with companies of our size is they go, oh shit, like the growth is going to run out.

59:21And we need to like pull these levers and their business becomes, it loses its edge and competitive advantage. Loads of unforeseeable things happen when you interact these three like levers. For instance, more products confuse the customer about who you are. More channels, we could take incrementality away from our DTC. People buy on stores, they unsubscribe markets um the the cash profile of the business gets destroyed because the cash business profile well because like when you have more markets you need to hold more stock in those different markets and you've got more products which all require stock holds so suddenly you're running out of cash right your dc business is shrinking because all of the sales from dc are going to retail which are lower margin you're making less profit you're running out of cash and your business is like, has become a juggernaut with 200 staff that can't actually change and do anything.

1:00:20And the whole thing falls to shit. So I'm just painting a picture of like, what can happen if you try and do too much too quickly. So my rule is, and what we say to the team is like, we can only do one thing at a time. That's it, one thing. So that's why we're still only UK and only one product and only direct to consumer. Because it's like, we're just doing one thing guys. That's it right now. so i love i'm asking this selfishly here so i um i've taken that approach with uh podcasting so i was like just do one thing and just do it try and do it as best as you can and then the rest will fall into place i'm not you know i was thinking about that second podcast i might start is is that do you think that's a distraction or is that actually just doubling down on the same thing i would i if you're feeling that itch do a second one i would wait another year and carry on focusing on your first, just longer than you think you want to, like just push yourself to go, what if I just spent another year making Hungry into the best podcast in the world?

1:01:23Like actually what's going to create more value? But no, but this is another, it's still under the Hungry umbrella brand. This is where people get confused. This could be the same. Yeah, under the brand. It's under the same brand. So it's not like me going to a podcast about fucking cricket. I mean, you know, this is still under the hunger. And this is why I think it gets very nebulous here because people think we're, and this, I know you've drawn it out really simply like these in terms of the Munger inversion rule, do these three things and you'll commit brandicide. Too many products, too many channels, too many markets too quickly, but it is a gray area.

1:01:56And that's why it's a common problem. For example, you know, Tyrells going from crisps to slightly extending their product line to vegetable crisps. that actually catapulted them forward but that's that's a very nuanced thing because it's not they're still staying in crisps vegetable crisps but they're not going in to hot chocolate but can i just ask you yeah go on how many years do they just do crisps for yeah yeah like 15 years 10 years i don't know how long it was like like because it's like it's the patience and it's the time that people like eventually we will do all these things but like the timelines we operate on are like like oh I've been doing this for a year like oh I need to push it and it's like no no you could do this for another five years easily just the one podcast just the one hungry podcast easily like so it's it's not that you you don't do those things ever and they're not good ideas, but it's about doing them at the right time for the right reasons.

1:03:05For instance, I'll just ask you, what has made Hungary so successful? The podcast in its current form. Well, I mean, I don't personally think it is that successful yet, but it's that whole sort of, yeah, just doing one thing well. Yeah, why is it done? Yeah, it's done right all the right, so why? Yeah, doing one thing well. But why is like that, what is that one thing? Just podcasting. What type of podcasting? Like long form conversations. Yeah. so why do you think the right next thing to do is to focus on a different type of podcasting yeah this is this is a really interesting point because i think it taps into a a new market which is interesting going through your thing in terms of getting bigger it'd be like a news show so we would get short format episodes um that it's like a new show so it's very it's very current very low level lift but Joe Rogan has become the biggest podcast in the world with one format yeah no these are really really so why why do you so why do you need that other format to grow the podcast

1:04:18yeah no it's a good question and it goes back to this inversion for all this is like is it a distraction is it a my answer is probably it probably is and like probably the oh the best thing you can do because i always say the other rule by the brick of building business it's not a dc thing but it's like when you're starting a business and you're finding that model when you've got it and it's working just repeat it for ages way longer than you think like just whatever's working that tiny product market fit you have that just captures something in the market just do that for as long as you possibly can and do it better and better and better and hone it make it better is is like the absolute principle for building a great business in my view that's how i think about it yeah and charlie munger talks about this in terms of catching a wave only you've got to read his book it's fucking amazing because you know to buy poor charlie's almanac was basically it was like 89 quid second hand on amazon for years and then he died and they basically put it out again so it's a very hard book to get um is it still hard to get no no no now it's like in reed it's in print again so it's really but mate you read it you're like wow i mean geez was a billionaire right so he knows what he's on about but um he's awesome yeah he talks about being in the wave and just sticking with it uh and it's interesting i mean The pain I'm going through now with, do I start another podcast?

1:05:46It's like, does a snack brand open another skew? I mean, this is where the supermarkets kind of fuck brands in terms of those three levers is because they say, right, we've taken your oat milk. What have you got new for us next year? And they want something new. It's like, well, this other brand's offering us something new. And it's like the monstrous beast of the supermarket is praying on the Goliath praying on the David saying, well, what are you going to give me next? And actually they're kind of, and they're linked, the system is linked to a problem. But there's ways of playing with that. Yeah, yeah, yeah.

1:06:23So the other thing is, how do you play with the system? I've got, you know, Seth Godin is. Yeah, yeah. Public Al. Coming on the podcast next week again. Yeah, he's awesome. I love his books. But he's got a new book coming up. I'll get this to go live after this called This Is Strategy. and so he sent me a few excerpts of it reading it, I'm like this is sick like he goes into mother nature and talks about mother nature of strategy and he basically says you need to understand the system and understand the rules of the system and the way people get status and stuff to then as you say break the rules of the system which is what you've done with this you're not playing in a field of sheeps you're a rhino it kind of links to purple cow but the But as you say, you've got to understand the system to break the system.

1:07:11I think he talks about strategy as a kind of an unvisited city that no one's been to. And your job is to kind of peel off and get there. So what you said there is you need to know the system, but then how would you break the rules of that? Well, for instance, because our focus rule means that we haven't launched products, but we know customers want newness. because customers buy in a supermarket the same customers buy online. How do you give them newness without losing focus? So we managed to do it by doing seasonal scents. So we now launch seasonal scents. We have a subscription where they change, the scents change, and we do a big campaign around the seasonal scents.

1:07:48So it's the same product, a couple of different oils, right? Different blends. And we've got our newness without losing focus. Yes, this is what I think this other podcast is. I think it's newness personally without losing focus. So you know like My First Million that you're talking about? What was that podcast you said that it was called? Yeah, My First Million, yeah. Yeah, but they've got that 20-minute show that you like. Yeah, they've got, well, they just do different length shows, yeah. Yeah, so this would be a different length show, same format. Yeah, yeah. I would just say it depends why your podcast, I think it goes back to like why is My First Million successful?

1:08:24Why is your podcast successful? um and and the focus point is leaning into that so do like if i was thinking about your strategy i'd be going what's different about hungry like what are the kind of features that make it unique and interesting and then how do i maximize those features like lean into those as much as possible they won't all be relevant but some of them will be and if you lean into all of them then you're probably going to improve and optimize like the the thing um in the way it should be optimized the problem with strategy is most people end up optimizing the wrong thing optimizing the wrong thing like you you know like optimizing the wrong feature so you think it's like it's not understanding why you've done well and then optimizing towards something else so so my first million might have understood something about their success which means different like formats and different lengths works but that might not apply to you because it depends why you've done like but is there a way because what the mic because there's loads in this right because for brands as well like a brand for example and there's there's so proper corn yeah proper corn did prop popcorn properly absolutely ripped it up they then tried to go into bars which i don't think went very well and i've i may be wrong but i don't think went that well i then think they went into microwave popcorn which i don't know if that did well or not so they they kind of put out these little chips and i think david hyatt who does hyatt denim talks about you've got your big bet but you also need these little small bets just to put on the table and i think where people get confused with focus and this is where we're getting into the nuances they put oh we're going to do a big bet on this because what you want to do is just put a little few things on the table and just see, you've got your main, keep the main thing the main thing, but then put a few little chips on the table.

1:10:23Don't put 200 grand on the table down. Put 20 quid down and test a little oil. Does that work? Okay, yes, it does. And I think this is where it gets to, because as you say, it's a paradox. You need to focus, but you need newness. And it's how do you, as a founder, fight with that tension? And what Propicorns are doing is they put those little things out of the bar. Okay, it didn't work. Let's do more of the popcorn. So I think they did more flavors. And then actually what they realized, and this is probably where the strategy gets really interesting is and i think the way you've done it is look inside of why has this worked okay this worked not because of popcorn like the popcorn bar didn't work necessarily the the popcorn we were they are if i don't know i need to speak to cassandra i haven't actually spoken to her but like if my analysis would be oh we've worked because we've made snacking that occasion we've uh premiumized and made fun and interesting so instead of actually doing more popcorn things that's the popcorn isn't actually the thing the thing is making the snacking healthy snacking interesting let's go into lentil chips which is what they did more snacking that's the strategy and then they've just gone they've got past that super interesting yeah and i i suppose what i'm thinking applying this to myself is it's like i'm thinking it's podcasting but maybe it's not maybe it's just like the long conversations maybe it's um as i said to you earlier i love the fact it's scatty and raw raw like i don't want to be i think it's interesting how people can find that but it's an internal job totally it's an internal job and i think i was probably thinking it's an external job do you know what i mean if you're a challenge a brand that's absolutely killing it in D2C, but you're struggling to crack retail, then you've got to listen to this.

1:12:05Maybe you've got an Ocado listing, maybe you've got a Whole Foods listing, maybe you're absolutely killing it in Selfridges, maybe you're absolutely killing it in your farm shop and your indies. But my friends, making the leap, crossing El Chasum, crossing El Rubicon to grocery retail is not easy. It's the Champions League of FMCG. It's super hard. it means playing at a higher level and that's where some of you amazing brands sadly stumble look retailers want stories backed by data not dreams and a pretty pitch deck and let's be real supermarkets are not just going to magically make a space for you and your little brand they need data something's got to go for you to get in for you to get on shelf and that is why i've got to tell you about north star they are the team that's helping purpose-led fmcg brands go from gut instinct dreams to unstoppable pitch decks that actually unlock retailers northstar i'm not like another data company that force feed you data like foie gras that act like a nasa space mission it's super super simple to use their team are amazing and they actually get the challenger mindset northstar are your shortcut to smarter decisions stronger pitches and investor confidence all built specifically for challenger brands like yours you don't need a massive sales team you need northstar link in the show notes click that link and you'll be able to book a free demo with northstar highly highly recommend that and thank me later yeah and it's um yeah and there might even be like topics that are particularly like engaging that you're you're hitting on like maybe it is psychology like marketing behavioral psychology like like there might just be things um like with joe rogan And it's obvious, like it's curiosity.

1:13:48Well, that's my, and it sounds interesting. The curiosity thing is, I think to have any longevity in it, from what I've learned, is you have to follow your curiosity. And there'll be episodes I put out that will bomb on the number. That's why I don't look at the numbers anymore. I can't because you just end up going insane. so there's an episode and you oh mate if you like all this shit yeah Status Game that's the episode on Monday I've read Will's story yeah so his episode goes out on Monday so he's been on the podcast one of my favourite conversations I've ever had he read the science wrote the science of storytelling the status game the selfie unreal books one of I looked this morning no likes on LinkedIn and I've on the car LinkedIn you know wanking over LinkedIn likes is kind of fucking sad really isn't it really but I thought I actually wank over LinkedIn likes

1:14:49But that was my favorite episode. I think you have to go with that. You have to go with what that's pulling you to. And I think if you try and be the audience, you become the audience. And that's dangerous. And I think it's a really interesting thing. Let's talk about curiosity quickly. And then we'll come back to these Lego Lollapalooza bricks. but um i think i think once i read someone you said the things you'd learned as you hit 29 was i was taking time in the day to read books in the working day again nuance why has that been so transformative to you as a founder like what shit are you reading um i think it's part of a broader a broader principle which i try and communicate to the team and that people struggle to actually act on, which is this idea of effectiveness over efficiency.

1:15:43And it's not about sitting at your desk for eight hours and working on a problem and typing away and replying to emails. We've got a big creative team, for instance, and I know creatives need inspiration. So it's like, but your creative team will never just go for a walk on Regent's Park with an extra Regent's Park. Beautiful. They'll never go for a walk for two hours in the middle of the day because they'll think, oh, you know, it's a working day. I can't possibly do that. But it's like, that will probably do more for your creative output today than sitting at your desk all day. In fact, I know it will, but people don't do it.

1:16:19So they're not thinking about the outputs. They're thinking about the inputs. Mate, I've literally, we're recording this on Friday. Today's newsletter is how, why people don't have creative cultures. What the issue is. Factory work, inputs versus outputs, Fordism, the World War, building factories and shit like that, building machines. Two hours input equals four units of output. Eight equals 16, blah, blah, blah, blah, blah. Keeps scaling up, right? That works in the factory age and the industrial revolution. It's very easy. You put this much in, you get that much out. We're now in the fucking ideas age, whereas a three minute walk around Regent Park may produce 300X outputs versus eight.

1:17:03It's asymmetric. It's asymmetric, yeah. And I think it's really interesting. I think what you're saying with that principle is you're actually looking to, I think everyone wants creative teams, but that's actually further downstream. You don't get creative teams. You have to hire curious people and then you get creative teams. Yeah. I actually think curiosity is the birthplace of creativity. And then you have to create a culture and environment where those people can decide, is that they can feel like they can decide how to maximize their output, not the input. Yeah. So if I need to go on a walk or whatever I need to do, so like Charlie and I will like literally sit in the office and read on the sofas during the working day because it sets an example.

1:17:49It's like, so you can do that, guys. Like we're doing it, you can do it. So interesting. I mean, I literally said like you should have like an unlimited book budget. Yeah, unlimited book budget, nice. And then like I read the paper in the morning, I come in, I read the paper, FT, like love doing that in front of people. I'll do it on the sofas don't care so it's and if I'm going to the like and gymming's great for my work so like I don't mind getting in at 10 if I've been to the gym in the morning and spend like an hour and a half there in the sauna it doesn't matter like I don't care because it'll make me do the best work when I get in or like be on the best form for an important call whatever it might be so yeah and the reading thing I find it very like the whole like phrase you can't see the wood from the trees i find that very much with leadership and running a company you're so close to all of it and what reading does same as like a good holiday is it just it takes you out into a different world a different way of thinking it disrupts those patterns of thinking which are actually unhelpful blocking creativity and you just approach problems in different ways i think reading is like a so when you're so at the cold face reading and you're literally looking at your business from three centimeters reading even if it's 20 minutes in the working day is like pressing an ejector seat in your in your pilot and it just fires you and you can see your business from 3 000 feet and it gives you altitude and i think seeing altitude allows you to see things from a much bigger perspective so that when you do shut the book and you go back you're looking at that three centimeter problem with a 3 000 feet perspective and it just gives you as you say in terms of problem solving is there like a specific problem that you've like what's been one of those really fucking hard problems which with the the kind of the the kind of the interweb and lattice work of kind of creativity and all that shit like and curiosity that you've solved okay so um like a few months back we were we were struggling a bit with growth and like just things weren't working as well and like we were just like what's going on like it's just been such plain sailing um and it was like the model wasn't like functioning as it should like the cacks were that the cost of acquisition were going up and cacking yourself exactly and that happens sometimes like things so it was like okay well how do we actually solve this problem um and it came down to all like what it came down to is thinking about the proposition and realizing we're changing as a business we're attracting new people uh into the company like the audience is getting younger it's changing demographically there's something not like the value perception isn't the same that's why the cat is going up with this new group sorry the value perception the value perception of our product and our offer is not is not is not hitting quite the same as it was not as potent what's the older demographic with more dough yeah so then we had to change it so we were so it was like just sitting in a room thinking think about this problem what can you do with three concentrates and a bottle to to create more value like how do you do that um so like um the best idea we had that that really like took us back up to our like previous growth levels we have so i have a three signature sense and then we have our three seasonal sense always live but they the seasonals change and um it was just that fusion of ideas to go well some customers want variety some want the same thing which is why we have the two bundles but what if there's a group of customers that want variety and the same thing each time and we created a new pack that merged the seasonality and the signature scents together into a new proposition with a new price point, a new offer attached to it.

1:21:47And the whole thing was scent discovery. So the whole offer was go on this journey of discovering these new scents and get this changing seasons, but also the ones you want. And it just connected and it hit, and we just found a whole new level of growth this year. So it was like that kind of thing. And how did the reading or like the doing nothing, Morgan Housel talks about doing nothing, which I think is interesting. Is that like, is the idea, did that come, you know? That idea came from, I think it came from another, I think it came from just doing nothing, but like looking at other things, like other brands or other industries.

1:22:33And the scent discovery thing, I remember it being, I think it came from looking at like perfume and that kind of thing and realizing there is a whole like group of customers that will care more about the scent than the cleaning. And like people who are scent lovers, they want change. They want newness. So I think you were just trying to lean into that. Yeah, it's almost the sense is the benefit. The cleaning is the feature almost in some respects. it's almost like the scent and the spa like is but the spa or the candle is is your version of apple's thousand songs in your pocket you know it's like it's it's super fascinating so then the so you got the we got the the bricks going back to these lollapalooza lego bricks and the lollapalooza is this thing that's going to just all link together and just build this huge momentum which has got you to 40 million is so the first one was business model second one's education content third one um was like it's like offer and pricing you know that kind of thing proposition stuff and that's all the kind of links to the value stuff and as is this this lattice work all links together definitely uh i don't know green brick if there is one oh i'd say sorry another brick is focus as well focus yeah yeah so like that's a yeah.

1:23:54Yeah, and just sort of, yeah. Yeah, yeah, just kind of going a bit further into that because I think that was interesting territory to kind of meander down. But the, yeah, the focusing is such a fucking paradox because it's like, there's brands like Rude Health. It started as cereal, Granola. Their MPD strategy was, like they were just throwing shit at the wall then they then found oat milk or almond milk and just went like that and their whole thing is try lots of new things and then I suppose your approach is be laser focused and I'm kind of, I would say I'm more like this lucky saint one skew laser focused but then their little chip have you seen the IPA they've launched into so they've focus focus focus focus do one thing well they've now changed that my mate works there do the right thing well because they've had to they've again this is where the system tesco come to them say well yeah the one skew's going well mate but like we need more than that if you want if you want more stores next year if you want more uh more facings per skew then you need to give us something new exclusively so this is the system kind of taking encroaching you on focus so then they go right just for test i think just for grocery maybe we'll have a it's not on the it's not on draft it's like a ipa alcohol free ipa orange orange can and uh that's that's an example of like this laser lucid focus with a kind of little bit of that's your seasonal thing i think that is the i don't know i don't know what you think on that this is it's tricky isn't it because it's it's uh it's both wrong and right isn't it because it's like i think the way the best framework to think about it is is it's just is trying to understand the the distraction and the bloat of what the new thing is so how much does it change because the way I think about focus is more about what's your competitive advantage and not ruining that by doing too many things and like not doing that as well or not progressing and becoming even better at that thing so what are lucky saint really good at

1:26:24i mean the product is fantastic and it's probably the closest thing well their their secret source is is probably the fact that they're on draft like it's that i think it's probably well actually that freedom thing's delicious so if that's true i would question why and obviously you know lucky saying are great so i'm sure they've got good strategists and stuff but like i agree i think it's all about the draft and i think all the value of the business in the brand so um that's all right i need to i actually need a pass yeah go for it um the other point on this is what got you from a to b won't necessarily get you from b to c yeah which is which but it's to your point it's those levers but it'll probably get you for but i always think it will probably get you further than you think yes um so like if you're especially if you're like us and you're impatient yeah because i think we're like entrepreneurs are naturally impatient oh fucking hell so you know like if you think yeah well it's just it's a really hard thing it's about patience fundamentally that's what it comes down to also you've got very much you've done this in two years three years yeah which is super quick super quick super quick um let's go back to the so the other brick what would you say the other the other brick is recording yeah yeah we'll go now yeah um oh shit okay bricks yeah um so we've gone through we've gone through business model The business model, the focus, the creative and the offer.

1:28:06I mean, obviously, the other brick is the product. That's what I was literally about to say. And actually, like, probably the most important brick. Yeah. And so the product is absolutely critical because, especially if you're food and drink or CPG or anything like that, because most of your business model equation is about the LTV. So the post first order, which is the repeat purchase. And what's made our business so fantastic is that 40 % of our customers that we acquire are still retained with us after a year. That's your churn rate. Our churn rate is our stickiness rate. So our churn is 60 % after one year, which sounds like a lot.

1:28:50but actually it's not a lot I mean if compared to most brands and companies you know 40 % of our customers are still with us after one full year still using our product every day and buying more of it so let's use this as an example then so there's a brand who's got an amazing product called Russell Atwell they are trying to do fresh chocolate Giles has been on the podcast great guy I think they've got him Bartlett from Stephen Bartlett as well but yeah so fresh chocolate their kind of piece de resistance is I don't know how I said it like that but piece of resistance or whatever the fuck it is is we have fresh fruit this is a great reframe and in terms of how you can put your price up so you pay more for fresh fruit you pay more for fresh milk you pay more for fresh vegetables you pay more for fresh orange juice why do we not have fresh chocolate they reframe it they put it in a fridge you have to have it in the fridge but it's this fresh chocolate organic cream I mean the product is me and Steemo me and Steemo they sent us a shitload before when we were living in Fulham mate it was like just before Christmas and I'm not I just sat on the sofa and me and Steemo smashed the whole shebang I love that it has to be in a fridge it's such a good well yeah that's such a good metaphor for it Yeah, great metaphor, but the issue they've got in retail, and this is where, again, it's like, how do you have the flight of imagination to take consumers out of that supermarket mindset and pull them from sheep to rhinos to the savannas of different areas?

1:30:27And they're having battles with that because the retailer's like, well, where do we put this? Because what's Surreal have done with their price? Do you know the guys, Jack? Yeah, I mean, they've been in touch, yeah. They're really interesting. They sent us some product. Yeah, so there, I'm still, that we've been trying to kind of going back and forth about them coming on the podcast but um their price is obviously quite expensive for the cereal yeah but what they've done on their adverts is they've basically said you pay more for a protein bar versus a chocolate bar so a grenade protein bar is two pound three quid a mars bar is 50p you're happy to do it there so why not why are you not happy to do it from cereal and again that's pulling people out of this flight you know the flight of imagination you need them to think something else and reframing it totally what other um so then now the business is at talk talk to me about going from like on these different growth curves so let's say i don't want to talk about zero to one i don't even want to talk about zero to five because i've always talked about that but like you're really going from well we're going for yeah we're going for a hundred now we're going for a hundred so So in the last year, what's the growth been from millions?

1:31:37So we went 18.5 million last year. Yeah. And we'll do 40 this year. So we went first year was 700 ,000. Second year, 3.5 million. Third year, 18.5 million. This year, 40. And then I suspect it would take us another two years to get to 100. That's what we're expecting. So we can add another 30 million a year for two years. And how are you doing that? Well, so back to our levers, right? Yep. Product, channel, markets. Yep. And interestingly, back to what we were discussing earlier about how can you create little bets and, you know, test things but not distract the team and distract the business.

1:32:23So what I'm trying to do at the moment is basically evidence gather around that. So I'm putting little tests out just to understand channels, markets, products, where there's the most potential for us. My modus operandi is stick what we're doing. Don't do any of it. And we will do that for as long as we can. What I want is evidence on strategically what's the next best thing for us to do to grow if we can't push towards that 30 million a year growth that we're targeting.

1:32:53So, yeah, we're doing tests in other markets, but very low touch. we're doing um we've got a huge product development pipeline and we've got a team of chemists we've got our own factory you know um we've got central chemists we've got uh surfactant chemists and all that all in-house um so creating other products is another big a big focus um and we're exploring retail too and like understanding what it would look like in retail so it's all just like trying to trying to work out the next steps and build evidence around the next steps. I suspect what we'll do is we'll stay very focused on online and on the UK.

1:33:40And we will build out the product range a bit. I think purely because the value of the business is in the brand. And the brand is so much more than counter clean in terms of what it represents and what we're trying to do to cleaning and you can't really achieve your aims and mission as a brand without well if people are still buying buying bleach for their toilet and they're using counter clean for their services their home is like not the home we want it to be it's not a purdy big home and so um it's it's important for us to lean into the brand like what the brand's trying to do the mission the vision um as a company um so that's why products is is like if i was going to dilute focus that's where i dilute it into more products yeah into into into into yeah into delivering our brand promise for customers is that you can have a purdine vic home which is beautiful smelling non-toxic sustainable um you can have that um we we can deliver that for you basically um And then do you not think so, so in the hotel, so let's just look at this one, we're gonna get interesting because what Hotel Chocolate did, or Chocolat has got a better, Chocolat is they had the online presence with the DTC, then they had their, where they got interesting is they had their own stores.

1:35:08Yeah. But, but if you zoom out, you on a much, the shoppers, shoppers journeys is they don't just look on Instagram ads. so having a bricks and mortar body and fig presence is going to increase the brand value maybe you'll sell less in Sains for example let's say go down grocery route people seeing you on shelf is going to add to the total brand value because you may actually want to say right we're just going to be in retail to be in retail but then if people go and buy it online that's where you make all your contribution your margin and shit like that like or would you go into your own stores or like how are you thinking about yeah i mean total brand expansion i 100 want to do our own stores and um almost like aesop yeah i mean we we call ourselves in turn like the aesop of cleaning like that's one of the things we're trying to we're trying to like build into our psyche like we are doing to cleaning what aesop did to hand wash and to all the things that you know that their stuff um yeah it's hard no one's ever done a cleaning shop before I mean it's literally like unheard of like no one's done a cleaning store it's not a thing going in and buying cleaning products from a branded store is just a bonkers idea but that's why I love it because it's bonkers and it's so different what would this store look like?

1:36:31well it would look like a kind of Aesop Le Labo type store what's Le Labo? the perfume company Le Labo La Laba, it's called L-A-B-O. Yeah. But it's, you know, obviously the kind of like natural... A lot of Pelosa Laba. That's a lot of L's, mate. But it's the natural, that natural premium home feel, spa feel for cleaning. People will be walking down Covent Garden, they'd be like, is that a fucking cleaning shop? Like, what the fuck? Yes. And, you know, then it's like this incredible smell and beautiful interiors and all that stuff. And you go in, you've got your lube bombs and your counter clean, your super scrub and all the things we're making.

1:37:07and it's kind of like a whole brand experience. And that's where I see, yeah, I would rather do that than retail, like supermarket, grocery stuff. Because then you're in control of the brand. So there's a guy called Oliver Lloyd, a really interesting guy who worked at Unilever and actually got a lot of brands. Funnily enough, I think it was Lynx, whatever they called it in the States, but he went to every, I think he's visited every state in the UK. He then set up Great British Chefs is an investor in Bativo interviewing them next week. Yeah, great British chefs, yeah. Really interesting guy. But he says, brands have got to have a knock-knock test.

1:37:46So, you know, consumer comes up to you, what is your brand? And I think you can control that experience way more when it's your own store. This is a supermarket where it's challenging. I think I read somewhere you said, like your 29 things you learned at 29. You said somewhere about hiring uh investing in in business coaches even if they're expensive big time who have you hired and sort of how much have you spent if you don't mind me asking because i think it's an interesting thing of um yeah like yeah what have you done with that describe that and like how much have you uh what have you learned what the principles from these guys or girls well the thing about um a growing company is that unfortunately what happens to most people is the company outgrows the people so the come as in the current people in the yeah what tends to happen with a fast growth business is like the it's kind of what we were saying off air which is what gets you to a from a to b isn't what gets you from b to c necessarily yeah and that's the same with people and that's the same with founders so you know charlie and i might be great for the zero to one million stage or the zero to five million stage let's say we could stretch ourselves that far but that doesn't mean we're amazing at managing teams of 100 people um or building business processes or being a great leader or empath empath or whatever whatever the skills that you need to go on that journey.

1:39:21And the way I've counteracted that and given myself the best chance of being able... You want to do that. You don't want to get a CEO in. No, because I'm interested in the challenge of like, can I do it? Can I learn quickly enough? Can I develop? I see it as self-development. Yeah, this is so interesting because again, I love what William Chase said to me yesterday or last week when I did a podcast. and bear in mind he's sold two businesses for a lot of years there are no rules to building a brand because people think there are rules there's there's literally no rules i think what i love about this is the kind of the the status quo commonsensical way of doing it is build it to seven eight mil then bring in a ceo from mars or pepsico or fill in the blank but i love your approach of actually fuck it i can go on this journey i just need to hire people who've got more experience yeah well i need to i need to be very intentional about my self-development amazing so it's okay that makes sense so also by the way with that is like i will also be very aware and want to be very aware of if i'm not cutting the mustard and i haven't developed fast enough and i'm very aware that might come at any point and my board and who's a volunteered board like is and we don't need them they're not investors if they ever turn to me and go look i think a better there could be a better ceo for this business i'll be out the door before like you you can click your fingers because it's like the right thing to do.

1:40:43So it's not like, and it's not, so it's not an ego thing or a pride thing. It's like, it's just, it's, it's just a fact thing. Like, can you do the job? But then, but then William Chase said to me, he goes, my biggest regret was selling the business earlier. And he says, I think I could have, I could have taken it further. And William Kendall said the same thing. He sold green and black. He's like, I sold it. And it's all, this is relative, right? They think he sold green and black for 35 or 45 million. but it doesn't matter how much money you make, you're thinking, why don't I set it for a hundred million?

1:41:13It's just the way the world works. Why didn't I take, if you wanted to take on that challenge, why didn't I take that challenge? Yes, so who are the coaches you've hired? So I've got a business coach. So that's like a leadership coach, basically. So like, how do you work on your leadership skills, which is such an important part of motivating a team. So that's like the leadership piece. Who is she or he? She's a coach, works at London Business School, I won't name her, but she basically teaches leadership at London Business School on the MBA program. Sick. She's awesome. What's she taught you?

1:41:49One or two principles? She's taught me about trusting your... So you've got instinct and you've got intuition. What's the difference? Instinct. So intuition is more nebulous. and it's a feeling of what to do and instinct is a physical thing. It's like your gut. It's like I can feel it in my gut that this isn't right. Or is right. Or is right, whatever it might be. But fundamentally when you're interviewing people or when you're making big decisions, using your instinct intuition will be it's a very powerful force to use and so what she's trying to teach me is to be in touch with both those things so sometimes you can feel things you're not sure what they mean and it's about trying to understand what they mean and use that because it's your most powerful asset it's your it's your evolutionary system telling you um better than any strategy book better than any amount of kind of overthinking or analyzing so what's better to go with intuition or instinct or you want to use both so it's about blending both of those things with your knowledge and your learning so intuition is more of a like ethereal kind of nebulous kind of like um what's a great example of intuition um it's like um it's you've all felt it it's like when you um i know so i would say i always lead with intuition i'm just trying to say i'm trying to work for me personally or what the the difference is between intuition and instinct well instinct is much more physical yeah so the whole thing is like it's the gut it's the it's the gut or the heart whatever you call it it's that feeling and like that okay okay yes okay i'm with you yeah um but what does that feeling mean and and so trying so working a lot on that um she's also we've talked a lot about future visioning and like a good leader always has to be happy in themselves and so we spent a lot of time working on like if you look forward in five ten years like who do you want to be and what are the steps you need to take to be that person and become that person because that happy person will be the best leader um and so it's a lot of kind of future visioning and quite woo-woo stuff but also very powerful because um you just kind of getting to know yourself really and it all starts with the self and then you can help other people it's like do your own seatbelt first and then you can do others so it's all that kind of thinking um like leadership thinking and um yeah talked a lot about like modern leadership and the change in the change in how people want to be managed from like you've got football managers for instance you go from like a sir alex ferguson to a pep guardiola like the leadership styles are just so different much more empathetic empathetic a heart is like heart-centered leadership and about empowering people and to get the most out of the younger younger employees which we all have to like millennials gen z you have to lean into that kind of heart-centered leadership um otherwise you're not going to last as a leader um so yeah just talking about that kind of thing so that's the business coach yep and i've got like a strategy coach which is basically someone who's like i've done this journey who's a guy called matt patilly patilly but tilly he's a canadian guy who started Peeler Case, the phone case, 100 million pound phone case brand.

1:45:41And then he's also got a brand called Lomi, which is a kind of food recycling machine, which is also, I think, 100 million pound brand. So he's just like done the journey loads for 40 years. And I can just talk to him about like, should we do markets or products? And he's like, well, this is what I've learned. What's he said to you? What's the nuance you've picked up from him? Well, his, so his big thing is around, is around patience. And so like his advice to me was go narrow and deep in the UK rather than shallow and broad. So we're at like 3 % market penetration now. So we're in 3 % of households now in the UK.

1:46:27He was like your, all your energy should be going into how do you go to 7 or 8 % penetration. so what does the brand need to look like wait say that again sorry so the the penetration now is three percent let's say yep we're in three percent of households in the uk now rather than thinking about how do i get into three percent of households you know in a different territory or how do i increase the value of those households he's just like what does the brand and marketing mix need to look like for you to get into seven or eight percent of households What does that look like? How does that change?

1:47:01Well, that's a great question. I mean, you need to appeal to more people, basically. And so... So would you say your core audience to begin with was middle-class mums? Older mums. Not actually middle-class, funnily enough. Yeah, yeah. All classes, but like older mums. Like kids a bit older, a bit more time in the home, that kind of thing. It's interesting. I was talking about, I wrote about this the other day between champagne and cocoa pot problems. so champagnes most brands cpg brands are middle class founders creating middle class brands to solve middle class problems in middle class packaging it's a champagne problem but as you go along the adoption curve yeah eight percent penetration you start thinking about the coco pop shopper which is not necessarily like an aldi shopper but is someone who's more price sensitive to the he thinks about the price of coco pops and i think so many brands get stuck here like well fuck how do we have the flight of imagination to go here or like totally what scale do we need to hit on the production side to make our price interesting and what what tyrell's did so cleverly is they they had this product say this is the champagne curve here so champagne's bottom left cocoa pops here you got the adoption curve they had that they started as the most expensive crisp in the uk and what they did is they built that volume up then they introduced the vegetable crisps anchoring, priced it here at, say, four quid a packet.

1:48:29So suddenly this crisp packet looks way cheaper. Yeah, I am. But actually, because the volumes went up, it meant, one, they could do two things. One, the perception of the actual Tyrell's crisps was less when it was anchored next to the vegetable crisps. One. Two, because the volume went up, they could actually afford to drop the price ever so slightly to tackle the Cocoa Pop shopper because the new skew, the crisps, when you zoomed out and looked at the total product portfolio margin, it would level it out. Yeah, totally. Genius bit of maneuvering there. It's fascinating. And that's like the segmentation piece.

1:49:05Same as what? The segmentation piece. So segmenting who your potential customers are and not by demographic, but by psychographic. Yes, mate. I fucking love this. And so like Athletic Greens, which we've... So one of my coaches is from Athletic Greens. That's one that's on Rogue. Yeah, all over Rogue. They'll do like 800 million quid this year. Like bar me. Fucking hell. That's wild. Yeah, all online. Wild. So segmentation. So they were hitting a wall of like, we've done all our champagne, pops, whatever stuff. So they started to segment, do a segmentation study on like, who are the people that could buy Athletic Greens and why would they buy it?

1:49:46and they just found this huge audience of people who travel loads have loads of money executives and what was their core audience was like to begin with like gym bros right yeah and they were like not my there were all these like no they're like there's all these like executives and like business like business people and lawyers and bankers who are like traveling loads but our product is in this big tub that you just would never take with you so the product's no good for them so they created this skew called travel packs same product they they upgraded they did a rebrand and made the brand a lot more kind of like premium and um modern and like there's a great ad i saw on the tube for them yesterday which was like typified their new audience they're going after on the tube oh so for listeners it says asset management ag1 and there's a there's like a gym row.

1:50:42What about St. London was that? That was in Angel. Yeah. And so like they're hitting the London audit, but like, so they redid the brand. They created this travel packs proposition. They put it on their website and they kept the website focused. So it was like part of the hero skew journey that you could choose travel packs or their original proposition. And what happened? Conversion rate went up, even though choice normally depresses response. What do you mean by choice depresses response? So like conversion rate is a key thing for website purchasing, like what percentage of customers buy. Normally choice will depress the conversion rate because it creates friction in the customer journey.

1:51:25The customer has to make a decision. People don't like making decisions. They'd rather not make a decision than make a decision. So you not only have to get them to decide they want to buy, then you have to get them to decide what they want to buy. Hence why I said that website was never going to fly because just too much like choice depressing response, response rates, conversion rates. So even though they increased the choice, it improved the conversion rate because it unlocked this whole new segment of customers, the travel packs. And the brand obviously was doing a better job of attracting them to the website in the first place.

1:52:04And it unlocked their growth journey from 100 to 800 million, basically, that one insight yeah it's almost like was it the uh was it british airways who tapped into the red-eye flight they did that that business class thing and it was like one advert which was like the whole point of business classes the the the they weren't selling the expensive plane ticket they were saying the fact that you get a good night's sleep and you'll like land and you'll be fresh for your meeting. Yeah. Is that the feature versus benefit? What time have you got another meeting? I probably, I do in like 15 minutes. Okay, cool.

1:52:46Yeah, we'll wrap this up in a sec. I've got one at two, but I'll push about 15 minutes.

1:52:54Maybe 15.

1:52:58Yeah, no, I think it's mad. So then in terms of your segmentation, where does it go? so we found some really interesting stuff so the kind of the habitual cleaner is someone who's like buying perdy and fig to clean loads so they're they want the same thing every time then we found out this new type of cleaner called the variety seeker so that's someone who wants the different scents so now we've got the signature seasonal propositions increase the potential penetration but the big thing for us is the brand and so we've got a rebrand it'll probably be out by the time this comes out um and it's it's trying to just broaden the appeal basically of the proposition um and i think it's it's an incredible job we we hired that global i think you should have a podcast no i'm not not trying to sell to you but i just did like irregard because i think you could get loads of different segments talking about cleaning you could actually get a gym bro because there's a guy i follow that's a cool idea called tm cycles who's like a gym bro but he he puts up content of him working out you know like burton you know he puts out fucking uh he puts out gym content but he also puts up like pictures of his house and shit like that yeah i think that could be really interesting and then you could also get like um that's really you could get a builder for example or maybe not a builder maybe that's a bit too much no no this guy coming into my house he's a plumber yeah came around the house he saw burley and he was like oh i've got that i was like i was like why did you have that and he was like oh i've got um a boat on the houseboat and he was like i use it to clean my house boat man i really think you could this this whole spa day cleaning is there's a podcast in that where we'll chat separately about that yeah routine and all that yeah well just like because i think i i um yeah you're transforming the way people think about think about cleaning i think in my head like in my head it's like i i would be way more yeah it's just interesting i think there's and i think in the site the The demographics thing is so interesting.

1:54:58And sorry, psychographics. I think the thing with demographics, and I've written about this before, is people think that a 16-year-old and, well, maybe not 16, a 20-year-old and a 40-year-old and a 70-year-old are completely different people. A 20-year-old and a 40-year-old and a 60-year-old who are all into barbecuing are actually fucking similar. So age, people look at marketing through demographic lens, which Seth Godin talks about this is psychographic is I've got mates who are like 50 who are into like Perry's one of my sponsors I mean him of massive age difference but we're all into the same shit I think with brands you can if you look for the psychographic lens you can actually really increase that segmentation whereas demographics quite reductionist and myopic in some ways yeah it's it's yeah I think that's really interesting how do you get other people um yeah almost do the ag1 effect on the on purdy and fig so we're doing a big segmentation study at the moment and and like trying to understand the different psychographics and what what are you sort of learning well it hasn't we haven't got it yet yeah so we it'll be out you know hoping that's it's been a big study like using yougov and loads of things like that um to try and get a read on a better reading it all yeah so and then we'll start testing propositions and working out how to go deeper and deeper.

1:56:22But I think the brand's going to make a big difference. The only final thing, mate, because I know you've got to go for this meeting, is are there any other interesting frameworks and shit that you've learned or applied from either coaches or books that have really kind of helped you? Because I know we talked on that other business coach. You've only got business coach and life coach. Yeah, leadership coach, kind of strategy coach. yeah those are the main two and yeah they're expensive yeah yeah yeah um but it's worth it um no i mean the only other thing i would say to people with with brands is um a few a few a couple of things at the beginning focus on sales not branding um i think branding and design and prettiness is like important but the main thing that matters with brand is like how many people are using your product because that is like the true mark of a brand and so i think a lot of people think too much about brand at the beginning um product precedes brand essentially yeah and sales get it into people's hands like focus on the sales and don't be too precious about the brand side of it like like the the direct response side which is what will drive sales dial that up more much more than you do already um yeah another thought is basically the market is really important the market you're in and i think a good team in a bad market won't win a bad team in a good market will win and a good team in a good market is going to do fantastically and so really try and understand like what's happening in your market and whether it's it's whether there's something there because you're just fighting a tide if there's not there's not growth in the market or a big opportunity in the market um yeah I think we agree on loads of things about differentiation over features and facts um like just just be different very different and take different strategies um and yeah I mean growth the growth mindset when it comes to businesses is the most important thing like everyone wants to be in a growing dynamic environment that's changing and i think what what drives that is is sales growth um and so if you're not like 90 percent of your if 90 percent of what you're doing is not directly leading to sales and growth then you're wasting 90 % of your time I think I see a lot I talk to a lot of founders obviously and I just see so much of the time is wasted on things that they think are important but in reality they haven't actually got a business yet so why are they focusing on them like such as well for instance we could have spent our first two years focusing on health and safety in our factory but we and we would have been shut down for the first two years but we just didn't focus on it because we didn't have a business yet it didn't matter if we were shut down it wouldn't have even mattered because we didn't have anything really like 100 grand whatever like so it's just that mindset of just like stop worrying about the details and all the things that could happen and the crap and just like what is going to grow the business get product into hands and make us margin at the end of the day so yeah just just a big thing on that um and then yeah um you a lot of food drink founders listen but i'd be careful about going into direct to consumer unless you're really going to focus on it and put the time and effort because the reason we're not going to wholesale and grocery is because it's like a completely different business and the people need to be different the skill sets the structure and it requires like you to be very good at it and to be focused on it so there's the big danger that you kind of just dilute the focus of your business and actually don't get anything from it because you're not doing it well enough yeah it's almost like either be a retail brand or be a d2c brand i think so the first few years i think so well yeah because i think what huell did geniusly or genius that's the right way of saying it is they built the powders d2c built a huge business there and then they gave this is in terms of just looping this all together as their small file was the rtd ready to drink bottle they gave them exclusively to retail which meant they weren't cannibalizing their d2c sales of the powder they had something fresh and clean to put in the fridges and i think that's that's kind of how you get it to but you know i don't know how long they were building on d2c before long time and if that those drinks are still a very small percentage of their business yeah tiny mate let's wrap that up there i fucking loved it we're gonna have to do a part two um because there's yeah i could talk to you for ages mate i'm so happy that uh things are going well for you and yeah keep fucking smashing it you too thanks thank you so so much for listening to the podcast i really really do appreciate it if you like that episode only if you liked it please do give it five stars subscribe tell all your friends families foes next door but one cat dog whatever please tell everyone about this podcast it means the world to me and i really want to understand what your pain points are as the new wave of challenger food and drink brands please do hit me up on linkedin search dan pope and hopefully we can together create a more meaningful and powerful podcast for the next wave of challenger food and drink brands thank you so much

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