S15 E2: The Right Way to Work With Influencers

0:00Nik:Welcome back to Limited Supply, the podcast where we get deep into the tactical and strategic side of e-commerce, digital marketing, and building consumer brands. I'm your host, Nik Sharma. I've spent the last nine years building, scaling, and investing in brands. And through this show and my weekly newsletter at nik.co slash email, I'm here to share everything I've learned. The wins, the losses, the experiments, the tactics, and the insights, all so you can unlock your next$100 ,000 in revenue. Today's episode is a good one, but before we dive in, let me tell you about our chosen sponsor for this week's episode.

0:34Nik:If you're a Shopify brand, pay attention. Roku Ads Manager is built for growth marketers and makes connected TV way easier to test. Go to advertising.roku.com slash limited supply. Ben, thank you for being here. Thank you for jumping on Limited Supply. I love listening to your podcast, so it's fun to have you here. Thank you, thank you. I mean, we did just have the Mr. Beast. I don't know if you've heard of him, but that was pretty crazy. There are only a couple of those guests. For those that don't know, I host a podcast called Good Guys with my dear friend, Josh Peck. And Josh, because he's a different level of a celebrity, he's able to just pull these guests.

1:17And when he texts me, he's like, we got Mr. Beast. I'm like, we got the Mr. Beast with 450 million YouTube subscribers. anything he touches goes to the moon. We got that Mr. Beast. And I listened to him on Diary of the CEO. And that's where, I don't know if you heard that interview. That's where I learned a deep appreciation for Mr. Beast, the entrepreneur, and thought of him so much less as just a creator, but the way that he studies the platforms, which is nothing that I've ever done. I literally like cook and throw up what I think looks good. Or I don't like study why did a video flop? Why did a video do well?

1:59Like Mr. Beast is, there's a reason he has 450 million subs. It's because he's a, he's a beast, no pun intended, but yeah, the podcast is fun. Yeah.

2:10Nik:What else is cool about the Mr. Beast world is, um, how, how much of an audience he is built internationally, like non-native speaking. I forget the stat, but he said in some interview that like, you know, only a small subset of the world speaks English. And so by not doing international content, you're just eliminating that entire audience potential. Yeah. It depends on what your goals are. Like if you are an entrepreneur and your goal is to grow your platform and sell something, it doesn't really help unless you're looking to do what he does, which is, I guess, launch, well, one, YouTube, of course, you make ad revenue, but then you have beast games where anybody can stream.

2:53But ultimately, he started talking about how, like with Feastables, Feastables cannot be sold into every country that he reaches. It cannot be bought direct to consumer with his 450 million subs. Like he's primarily focused, it would seem right now on the United States. And for me, a significantly smaller creator, I don't need... The idea of having 450 million subs and reaching that amount of people on an international level would not in any way, shape or form advance what I'm trying to do. Does that make sense? Right. Yeah, totally. I heard... We both worked for VaynerMedia. I heard Gary say this a long time ago, that if you, some people are very focused on growth.

3:38Others sort of take a look at what they have. And it's like, I have one and a half million followers. If I could convert 10 % of them to become diehard subscribers of a brand, I won. I don't need more subscribers. I don't need to have one in 10 people in Latvia know my name and face. So it's amazing what he's built. it's just it's like it's so a totally another level sometimes i don't even know why he does it like what do you do with that like i don't you know what i mean like what do you do with that

4:13Nik:yeah i think it's um for them the end game is probably outside of like launching some of their own stuff probably the international level of brand deals that they can go and do or or you know the ability to create one video dub it into different languages and each region has its own you know, like national sponsor, maybe that would be my guess. It's too big for me to even think about. He has, he told me he has 600 employees and that's where my brain broke. It's like, Oh, and he spent$5 million per YouTube video. And it's like, yeah, yeah, yeah. That makes sense. That makes sense. Now all of this makes sense.

4:47So.

4:47Nik:I feel like creators good segue into today. Creators can be used as like a content machine, like supplying the content, whether it's creating the content, They could be used as distribution, reach and trust. They could be used as market research. Sephora does this a lot where they set up these every six-month meetings with creators to find out what's their audience asking about or talking about. And then also as sales accelerants, either through social proof and driving sales. But in terms of how you have seen the evolution of creators, is there one you would say is bigger than another before we dive into each one?

5:25Like what type of, like, I think that using creators for authenticity is the holy grail. Like that's the best place, which is increasingly harder and harder now. But I think that using influencers for credibility in their, whether it's micro or macro networks, is something that brands struggle with every single day. Like every, with Spritz Society, we talked to some of the biggest brands in the world. We did a collaboration with Kraft Heinz and Clausen, for example, and we launched that Pickle Spritz. And a brand that's owned by Kraft Heinz doesn't know the first thing about community. And they'll tell you that first and foremost.

6:04It's creators that have typically unintentionally built these cult-like communities that brands are dying to get a piece of. Because if you come in and you are the brand with a brand voice, it's very, very rare that you're able to crack community without it. I think one prime example of that is Chipotle was really able to do that, where they were able to somehow, I don't know how, create a community around a brand without somebody sort of speaking for it. Now, unfortunately, I think they're having some product problems. problems. But at its height, when the product was great, and the community was great, and the social was firing, all of a sudden, they had that perfect storm, which is what created such a viral brand.

6:45But I think that brands being able to borrow the equity of authenticity for creators is probably the... If you can do it, it's the number one thing. Because you can always buy awareness, you know? You can't buy authenticity.

6:58Nik:I guess, how do you think about those... I think a lot A lot of people would hear that and think, oh, that means we need to work with more creators. But it sounds a little bit different because that would just be buying that reach, right? Are you saying these are more longer term partnerships or like deeper partnerships than just? I think it's however you can make it real. If you know that X influencer is a fan of your products and they have spoken about it authentically for the last three years and they use it and there is no one that will question if it's real. then you can go and buy a post from them.

7:34But typically that like, if you can do that and you have a celebrity or an influencer that has a track record of that, you can do that. Otherwise, you probably need to fake it. And the way that you would fake it would be, okay, we're going to start by seeding to them, right? We're going to send them free product. We're going to hope that they throw it on their story. We're going to hope that they just use it. We're going to follow up with them and see if they've used it, became fans of it. I'm going to buy an ad or read on their podcast. I'm going to buy a story post. I'm going to start to make them feel like I'm a long-term sponsor.

8:08It would be great if you could come out with just a year-long deal, but I wouldn't even do that until I found out that the person really, truly loved and consumed and used, my brain immediately goes towards consumer products that you can ingest. But it could be like with what you've done with Jolie, it could be a person who actually cares about cleanliness when it comes to their home shower. Like if you go out and you work with an influencer that's never spoken about the fears of toxicity in the home, and all of a sudden you buy a year's worth of ads with somebody that it's no amount of time will convince the audience that this is real.

8:49It has to be real. So it's not just about, I think that this is where brands get it wrong. They all love their creator IQs and whatever the platform is in the moment. That was probably the platform six or seven years ago, whatever the platform is now where brands are paying to have access to talent, they're looking at audience reach. They're looking at engagement rates. They're looking at location. They think that they're looking at interests. But in reality, I actually think that you have to follow these people to really understand what they're about, what is real, what is not. Like you, you listen to my podcast.

9:30So you would be, and we're dear friends, but you would be the perfect person to say, I actually think this would be perfect for Ben because you know, Ben, and you know, what would work. You know, that if you asked me to promote Jolie shower heads, it probably, it probably wouldn't work because that's just not, that's just not authentic to me. But if you had a new fucking supplement that you were trying to, I can authentically talk about trying a supplement and I will be totally honest with you. If I liked it, if I didn't like it, if I had adverse effects, because I talk about that all the time, or if it was in GLP-1s because I've lost 60 pounds on ZepBound, like great, Rowbody, Weight Watchers, this new pill, whatever it may be, like things that are authentic or any food brand because I cook so much.

10:17But if you gave me something completely out of left field, it, you know that I'm Jewish and I don't eat pork. If you asked me to promote the bacon, egg and cheese at McDonald's, that probably wouldn't do well. And it's just, you don't, you're not able to know that unless you follow the person. Yeah.

10:32Nik:I feel like a lot of the, like the influencer, okay. In the direct consumer, even the wellness world, a lot of the influencers get, they do these kind of not do, but like they have these long-term relationships you see play out with these brands. And I think it's because to your point, a lot of these relationships start by sending product and they're relatively low barrier to entry for these brands that just got funding. They're not paying for these posts up front. And so they are working on building a relationship over time. But with the larger creators, like somebody like yourself, it might be harder to do that because you have a floor to what you will accept in order to create content.

11:13Nik:But they could still start by sending you product. It's probably just like the bigger the creator is, it's probably a little harder to start that relationship unless you maybe have a way in. But I also think that is like the advantage. Have it be a good product, though, like and have it be a value add to me and have it be something that you think I'd like. like creators uh influencers celebrities who whatever they are whatever they call themselves uh just like you wouldn't want to receive endless an ounce of something that you don't want or care about like the gifting space has become and people hear this and they they think like oh like it's it's such a privileged or see free stuff it's like it actually becomes really really really really annoying like when you keep getting gifted by a brand where you don't like their products you don't have room for what they just sent you i live in an apartment and i had a there was a time where body armor and i love body armor this is an example of a brand that i love was sending me cases and cases and cases of body armor i don't have a garage i barely it's just like i don't know if you know that i live in manhattan or if you think that i live in iowa like i don't i don't know where you expected me to store this stuff but so i bring that up because gift something that somebody will be excited to receive.

12:32It's called gifting for a reason. It's not shilling free product. I can go to Costco and I can try a sample of something. Give me something that will be a value add to me. Make it personalized to me. Write me a nice note because you are a fan of mine. Create an emotional attachment. Don't just print something out, spray and pray and hope that I post about your chocolate company because I don't owe you anything and you haven't made me feel like I I owe you anything. So gifting gone wrong can actually completely turn somebody off to the brand forever. Gifting gone right or done right without any expectations.

13:07Like don't write in a note, Hey, I hope you post at this. Why would I do that? I don't, I don't know you. I don't know you. It would be like a, it would be like a complete stranger, which is also like a number one turnoff. I'll meet somebody and they'll say, Hey, can you promote this for me? And it's like, No, no. Why would I do that? I don't know you. Like, so versus if you text me and said, hey, I'm working with this brand and it would mean a lot to me if we could gift you. And if you like it, post about it. We're boys. So that's like, you know what I mean? And if you don't have that relationship like me and you have, you use a PR firm to create that relationship.

13:49Nik:Right. I can't stress enough. People think of PR firms because when they're used wrong, they're a complete waste of money. Like awareness marketing and PR, I think it's just like they charge you so much money. Retainers, I hate that. But using PR teams to gift their roster, I think is huge. If they have the right talent roster, they have 100 people that they've worked with over the last 10 years. They have intimate relationships with them. And they will know, will this person like this? Will this person not like this? Who should I gift? and it's no longer Ben's company gifting this influencer.

14:21It's the PR rep who reps them recommending a product to them. It's the same way that I think Dave Grutman structures almost every single one of his investments where he invests in something. And then all of a sudden he's sending out a PR box on behalf of Dave, not on behalf of Skinny Almond or whatever the hell that brand is, Skinny Dipped, right? It's not a Skinny Dip box. It's, uh, I'm friends with you and Dave Grutman wants to give you skinny dips because he invested and because he stands behind it and thinks that you'd like it. So it's just, it all comes down to authenticity. How do you create a great relationship with, with talent and with the customer?

15:02Nik:Yeah, that's such a great example of it too. I remember with, uh, we did the Judy and Poopery, uh, collab bag. And that was another great example where Poopery got to leverage Simon's relationships, where he gifted out that collab and everybody was posting about it because of Simon. Exactly. We just invested in and are very active in a company called Swishables, which you're active in as well. And I brought you on that. And the founders, Goulshan and Harry are amazing. It's the first single serve mouthwash in a stick pack. Just a genius, genius product. But we are doing those gift boxes where it's not Swishables reaching out to Lauren Bostic and saying, hey, I want you to try this.

15:45It's me reaching out to Lauren because we're friends and saying, hey, you know, I think you would absolutely love having a single serve mouthwash in your handbag when you go out for a night out. Or I think you'd love to have them in your podcast studio because you're talking to people so up close. Everybody wants good breath, but everybody wants it in a convenient way. And because it's a value add to her and it came from me, I know she's going to try it versus if it just came from the brand. Yeah.

16:13Nik:So true. Could you talk a little bit about the Spritz Society playbook you created too? Because I think that's another amazing example of this kind of longer term relationship being applied really thoughtfully. Yeah. So with Spritz Society, we obviously started with a community. We had a community of mainly millennial women driven by boy with no job, girl with no job, even more so. And then the Toast. Toast is the number one female millennial podcast in the US. My wife, Claudia, and her sister, Jackie, co-hosted. And I had been working in marketing for about a decade and knew how to market products, knew how to work with talent, knew everything that we're talking about.

16:55But it came down to authenticity. It came down to having a community. And I just had that sort of aha moment where it was like, why aren't we doing this for ourselves? The alcohol space had just exploded. White Claws and Trulies were doing billions in sales. They tasted terrible. And it just, it seemed like the space was ripe for disruption. And so we galvanized our community to help us ideate what could this alcoholic product be? It was the perfect intersection of sort of Aperol spritz culture was exploding and I didn't see anybody doing that. So why don't we launch the spritz society wine-based sparkling cocktails that actually taste good.

17:35And I can tell you four and a half years later, we are still this year, Nick, I don't know if I've told you about it. I can't tell you exactly what it is, but if I, if I haven't told you about it, I'll call you later and I'll tell you about it. Um, in, in March, we have a new product going nationwide and target. And this is our hero skew. It took almost five years to figure out finally, what does Spritz Society stand for and what is its hero skew? Because of everything that I just told you with the ability to build relationships, we were very quick to smartly tap into influencer and celebrity partnerships with friends and investors to grow the brand without spending a ton of money.

18:16That was Lauren Bostic's pink lemonade. That was Craig Conover's lemon iced tea. That was Clawson's pickle spritz. And throughout all of that, I'm not like, this is the, this is like the true nuts and bolts of being an entrepreneur and founder. We, we lost the core brand and the core brand, like what is Spritz Society? It's not, it's not an influencer collab brand. What is it? And you're going to see it in March. And it is the, it is the core hero product. and it came through the community. It came through trials, tribulations, testing, learning, and sort of brought us back to our nucleus. And it's really, really, really obvious and epic.

19:03Nik:That's amazing. But I bring that up because I'm sure that there are so many founders of direct consumer companies, even though we're now mainly a retail company that uses direct consumers, is a flywheel to push to retail. But there are so many founders out there that like this, it always, it always stuck to me whenever I'd rock shark tank and Kevin O 'Leary loved to say, if it's a dog, like go in the back and shoot it or some like some expression like that. And it's sure it could be a dog or you could just not have found the product. Like we know we have marketing. We know it. We know we have branding.

19:42We know we have community. We have a brand that people are behind and the products have been good. But in order to compete with a high noon, a surf side, a white claw, you need a great product that doesn't only attract your community. It attracts the random person that has never heard of you, who sees it on the shelf at Target and wants to try it because it's something that they think is interesting. Regardless of the brand, it doesn't matter. Like what are the reasons to believe in a product? And you don't have to have that on day one. You probably won't. Like just take some pressure off. Don't spend too much money in the process, but take some pressure off that maybe you don't have everything figured out.

20:22Like maybe for some people, they have the product, but they don't have the marketing. It's the same thing. You're going to test and learn and all of a sudden you're going to see, oh my God, that was it the whole time. And don't be hard on yourself that it was at the whole time. It took you a while to get there, but you got there. Yeah.

20:40Nik:I love that. Yeah. Always be breaking. Shopify brands. This is the one Roku ads manager lets you connect directly to your Shopify store and run streaming TV campaigns that can drive action, not just awareness. Roku's positioned this as a big differentiator, shoppable TV through action ads and their Shopify integration. If you want Top of Funnel on the big screen with a proper path to purchase, go to advertising.roku.com slash limited supply.

21:11Nik:With a brand like Swishables versus a brand maybe at a later stage like Spritz a few years in or something maybe even later, a brand doing like$10 to$50 million, somewhere in that range, how would you say, how would you recommend they approach the thought of influencer marketing or creator marketing? Because like with, with Swishables, even early days in Spritz, I remember we used creators for really for content creation and filling up the sites, getting assets, you know, different settings of product. Whereas today, if you're launching something with Spritz, you might want to attach one bigger name to a product launch to help push it, you know, using it differently?

21:52Yeah. Well, first I would go down to the nuts and bolts of the business and what you're selling. So Swishables direct to consumer is selling a weightless pack of mouthwash. So we are in a very unique position where gifting is free. It's free. You're paying for postage. And postage is not Spritz Society. It's$20 a box. It's sign on delivery because it's alcohol. It weighs a lot. They're completely different. So on the swishable side, I would literally, and I've said this to Gulshan before, I would gift everyone. Why not? It's free trial. It's also the ability to then learn through that who are the influencers that really love it.

22:39And then once you know that they love it, they're in, it's a part of their daily habit, then we pay them. Then we offer them something. Then we bring them into the fold. If you're fortunate enough to have a weightless, lightly regulated, direct-to-consumer business where you're selling a product, that is the playbook. Gift until you really understand who really loves your products. And then once you know who really loves your products, you can start paying them or make them, have them invest or whatever it may be. On the Spritz Society side of things, it's trickier. But I love the example that you just gave of we used influencers, not macro influencers, micro influencers for 50 to 100 bucks a piece to get product and make content.

23:31And when we launched, we had 200 assets from legitimate creators with niche communities that not only reached their micro communities, but also helped us populate our site with UGC, also helped us fill out our socials. It depends on what the goals are. But influencers don't only need to be used for mass awareness. They don't all need to cost a quarter of a million dollars. They're very useful. I hate that people think that macro influencers aren't useful. There's nothing more useful, in my opinion, than an authentic macro influencer. Now, if you have a Jennifer Lopez who very publicly launched a Delola sparkling wine and Ben Affleck, her husband at the time, is an alcoholic and she doesn't drink.

24:15If you were to hire Jennifer Lopez for your alcohol company, she would be a waste of money. If you were to hire Alex Earl, like SitMargs did, it will completely transform your business. Because Alex Earl is, I think, 24 years old, a party girl who I believe is drinking SitMargs. I do. That is about as authentic as it gets. And so overall, macro influencers, celebrities can be completely game-changing if authentic. If you are just going and you're a brand with enormous amounts of money, incredibly deep pockets, bring on an agency and they go and pay a bunch of people that don't make any sense, that's when you start to get into hot water like a Budweiser a couple of years ago.