How Guru Became North America’s Leading Organic Energy Drink Brand

0:00An influencer relationship should never be a transactional relationship. We almost treat them like employees in our payroll. Hey everyone, thanks for tuning in to Shopify Masters. I'm your host, Shuang Esther Shan, and this is your companion for starting and scaling a business. In a world drowning in artificial energy drinks, one brand dared to be different. That's Guru Energy. From Montreal nightclubs to Whole Foods shelves, Guru launched something giant beverage brands failed to accomplish. A refreshingly authentic drink made with real high-quality organic ingredients that don't make you crash.

0:40Guru's unique angle has cut through the competition, remaining in business for nearly three decades. Today, I'm here with President and CEO Carl Guayette and Xingli Li, the VP of Marketing. We will uncover how this adventurous brand turned natural ingredients into a blueprint for modern-day brand building. Shingli and Carl, welcome to the show. So pleased to be here. Thanks for having us. So grateful to have both of you here. And I know Guru has a long history. Carl, you joined about a decade ago. Can you take us back to how Guru got started in Montreal's nightlife scene? Of course. This is one of those wonderful entrepreneurial stories that started in the 90s, actually.

1:31our founder was operating a few nightclubs, one of which was quite iconic in Montreal. It was called the Sona. And it was an after hours nightclub that did really well in the 90s. And after hours, obviously, they wanted other beverages because after 3am, they could no longer sell alcohol. So they were looking for other beverages to serve their clients. And back in the 90s, some will remember there was a big trend that was called the smart drinks. Really, it was the early days of nootropics or functional beverages. But they were really operating this. They were making those smart drinks out of a special bar that was called the Justin Smart Bar.

2:18And they were selling those smart drinks. Imagine a bunch of blenders on the bar and they were mixing green tea extract with yerba mate and ginseng and coconut water and tropical juices and other functional ingredients similar to what there is in Guru today, but all natural. They were blending it and making it for their clients. And they became quite popular, not just in Montreal, but all over North America. The energy drink scene was starting around the same time, right? So there was the smart drinks and the already energy drinks. And energy drinks were all, right from the start, they were all made from artificial ingredients, very synthetic.

3:00So her founders saw this as, hey, there's an opportunity in energy drinks. The smart drinks do well for us. Why don't we make a ready-to-drink, better-for-you energy drink already? Way ahead of its time, right? Many people would argue that a better-for-you energy drink in 1999 was not necessarily top of mind because most people did not know what an energy drink was. But really, that's how it started. It started as a side hustle, but it picked up, right? It picked up quite, grew organically quite rapidly, became popular. The Guru brand somehow resonated well. And then they decided to focus on Guru as their main business.

3:36And then I came along. Yeah. Well, it sounds like the idea for Guru was so ahead of the curve because only now in recent years are we exploring more functional ingredients and also expanding the beverage category. And it sounds like Guru found a way to set themselves apart. Shingli, of course, there has been so much to the journey. And I think a big change to that is focusing on understanding the target audience. Can you walk us through some of the process that the Guru team has done to refine and understand the different profiles of customers that the team has? Absolutely. I think Guru as a brand has the appeal to a very wide variety of audiences.

4:21We're the number three brand in the province of Quebec behind Monster and Red Bull. But in the world of marketing, focus makes you bigger, not smaller. So when I came into this role, it wasn't even just about the consumer, but it all starts with our positioning. and really understanding which consumers or groups and segments of consumers are most capable of loving what your brand does. From there, we start to understand their behaviors, their needs, what we call psychographics beyond just who they are in age and numbers. And from there, what we want to build is really what is the emotional and functional story and benefits that our brand stands for that will really resonate with our persona.

5:09Or in our case, we have multiple personas that all tie to one real strong need, which is positioning ourselves apart from our synthetic competitors in as the OG better for you energy drink. It sounds like you're not using traditional demographics, but you're really honing in on what Guru offers and how that relates to what customers are seeking in the beverage that they're purchasing. Yes, totally. And we use a whole bunch of very rigorous combination of social listening, consumer surveys. I personally read through almost every single review on the brand, you know, all our DMs, direct messaging, along with Shopify's platform on more of the demographic and behavioral data.

5:53And of course, I think in marketing, it's ongoing A-B testing, understand what works in which formats on what platform, and then testing and learning through a cycle of listening and refining. If I am new to building a brand and I understand my product, but I don't know how it would relate to potential customers, what are some first steps I can take to get a better understanding of how I can be better speaking to potential customers? For sure. I would try your best to understand beyond the demographics, really understanding this consumer's lifestyle, their needs, their motivations, but also the barriers.

6:34So what's motivating them to switch from what their current usage pattern is to your existing use case and start testing and iterating, whether it be organic or through paid channels, to understand what's really driving the clicks and what's really driving the purchase and intent. Yeah. And I think to your point, understanding the customer is an ongoing process that you have to do constantly. Carl, for you, you joined the team back in 2014. So you've been in the trenches trying to understand customers for a very long time. I want to understand how you managed to take the founder's vision and use it as a jumping point to grow the brand even more.

7:18Yeah, a few things that come to mind. The first one is trust. When you're joining a business like this and joining founders, you need to find a way to quickly build trust and build the vision, the values, the culture of the company together. right because you're it's almost like they're handing over your their baby in some ways right that was coming in as a new partner but there we spent a lot of time right so the first time the first thing was building trust and talking about the mission the vision the values that we wanted to to take and really got into a little bit of strategic planning but i guess i might get into this a little bit later on but really the core was hey where do we want to go where do we see this business?

8:05What is the size of the prize? How are we going to do this? What's really important for us in terms of values? What can we compromise and what we cannot compromise on? And agreeing on that set of values really was kind of the foundation for us to work together in a partnership and building the trust that we needed to operate and each have our own space. Yeah, I think it's also really important for founders to think about longevity of their brand that they're building and actually think about how to find complementary talent to round out their founding team. From your perspective, what would you say to founders who are in that scale up process?

8:47What kind of talent should they be looking for so that they can grow the brand even more? I guess what worked well on my side is I was always an entrepreneur. I came from an entrepreneurial family, but I grew up in a big tier one corporate world. I kind of learned a lot of the process, mechanics, spent a lot of time in strategic planning, in brand management, in sales and in distribution. So I think I was able to bring this business to another level using my entrepreneurial skills and the founder's entrepreneurial skills, combining this with some of the skills that I was trained on, right, post business school and graduating the different ranks in the corporate world.

9:32And I was able to bring this, I guess, to bring a little bit more of a structure in what I described as vision and mission and build this into more of a formal strategic planning, operational plans, and making sure we execute on this, right? So if there was anything like in terms of going back to your question is try to bring different skill set skill sets but also put this together in a process that's easy enough that founders you know bring the founders with you don't bring the big fancy processes but the things that really work keep it simple and take the founders along the journey well i guess the question to the both of you right you're hired at different points of business and there is the hope of scaling or leveling up to the next playing field.

10:22What were some of the things that you did differently to think about leveling up Guru at the different stages that both of you have joined? Carl's done an incredible job scaling distribution in the brand and scaling the brand beyond just Quebec. I also came from a blend of entrepreneurship startup, but also this big corporate CPG background. And from there, I think it's really around building this to become a North American iconic brand, mimicking the success that it's had in Quebec beyond just the Quebecois consumers. And I would say, you know, when it comes to building the brand, it's, again, really has to start with the product and our positioning.

11:11But ultimately, product will only take you so far. And what we're here to do as a brand right now is to sell the brand, then sell the can. I love that. Yeah, because I think if I'm on board with what the brand stands for, then I'm more inclined to return to the brand and incorporate it into my routine. Yeah. That's exactly what I was going to say I was going to say like this the reason why this industry especially energy drinks is so difficult like so many brands have tried in this industry and only a few brands have survived just like Xingli said like having a great product we firmly believe we have the best product but that's not enough to win you also need to build a very different brand you need to be differentiated on the brand and on the product.

12:01So some of the things we did initially, building distribution was really important and we were quite successful at doing this over the years. But again, that's just building this distribution. I would say that creating the demand for the brand is as important or even more important to be successful in this industry. And so it's always balancing this. Because if you're building distribution too fast and you don't have the brand equity to support that distribution, then your velocities are not going to be there. And obviously the reverse, if you have this outstanding brand, but you don't have the distribution, then it's going to be harder.

12:38I would say that D2C and digital marketing somewhat helps in this. Strategy and having a strong website like we have allows us to have a more full funnel digital approach where retail distribution is not the only way anymore. There's other ways to sell directly to our consumers. which just reinforces how important you have to have a full funnel approach to marketing just and that's what Shingli is leading to make sure we're we're there at every level and take the consumers through the journey yeah I think when we're thinking about investing in the brand and thinking about digital there is that tension right when you invest in brand it might be attending events and investing in things that don't have an immediate impact that you can measure versus if there are digital campaigns and ads, you can see how things convert.

13:30So how do the two of you kind of reconcile that tension and how do you approach that philosophically? I am a deep believer that it's not one or the other, and they both work together, both short-term and long-term. And really it's around balancing that scale between the two. My approach is I always start with the consumer. One of the first things we do is map out our omni-channel journey, who our consumers are, where they are, where they're shop. What is their mindset and behavior at each stage? And we tailor our content very specifically and accordingly. I always tell my team we have to fish where the fish are.

14:10Right. And then from there, to answer your question on is it brand first or performance first, really, I think it's really about having clear content roles and goals across your marketing activities and channels, right? So awareness for us is all about selling the brand, then selling the can. What's our ability and platform to best build deep emotional connections to tell our brand story and communicate our core values as a brand? When it comes to conversion and consideration content, it's direct. It's being tactical. It's to talk about the functional prowess of our product, which we know we're confident about, but also that it'll drive immediate action and trial.

14:54And I think for platforms like Shopify, it allows us for rapid experimentation and real-time learning. So if, you know, we're going out with a campaign talking about a new product with a very clear A-B testing strategy, we're able to then tweak our digital platforms based off of how well each campaign is converting and get real smart about which consumer we want to speak to with what message. Yeah, talk to us about some of those brand investments, right? Activations that Guru is a part of. And even though it is an investment and kind of harder to measure immediate impact, there is a way to say, well, that was a great investment.

15:35We can see the growth of the brand versus ones that felt a little flat. Yeah, for sure. I think from a brand standpoint, it's really being clear on the communities we go after and then being very strategic about which events, partners, or pop-ups where we want the brand to appear. So instead of, as I mentioned before, if you try to be something to everyone, you end up being nothing to no one. So for us, it's which events, which influencers, which ambassadors are very clear in our communities where we think we have the most reason to win, where our consumers are organically already using us, and we over-index in terms of development as a brand.

16:20From there, we want to understand their world and build our brand into our community's brand world versus pushing us at mass sampling events or popping up in places that have little to no relevance to the community and consumers that already know us and love us. Yeah. Well, Carl, why don't you share some examples of either like brand activations or events that Guru has been a part of that has been really memorable? I'd say what's moved the needle for us, and if I look back, not necessarily just at the recent past, but let's say over the last decade, clearly anything digital has been increasing, giving us a good return.

17:04And that's why we've placed bets on this, whether it's ambassadors or content creators, influencers, anything around social and paid media on digital has worked well for us. campus programs, anything that has to do with, you know, again, if you think about our brand, if you think about our consumers being more educated, being more careful about what they put in their bodies, very progressive, white collar, obviously our next generation of consumers always feeds off university campuses. And we've done really well on this in the Quebec market, for example, by executing this well, we became the number one brand with the 18 to 25.

17:47so clearly this is one that that where we we've seen returns we've done some that's a while ago but like nowadays i don't think it would have the same impact because we tried to repeat this but we did a little bit of tv right we did reality tv here in the quebec market and it did work well for us integration and reality tv worked well but that's several years ago right when now i look at our consumers they don't watch tv as much as they there was one show where we we were able to have access to that new generation. Nowadays, like we tried to repeat that with some other TV shows that didn't deliver the same return.

18:24So I'd say I'd focus on social campus programs, or I would echo what Shingli said, right? Just showing up at the right places. It all goes back to understand who your consumer is, who you're targeting, and then showing up where they are. Yeah. I mean, this is just for my personal curiosity. What kind of reality TV was Guru on? It's called the occupation d 'Europe in French, right? It was more of a, it's hard to describe. It's a dating show, right? So it's a bunch of participants went on different trips. And the goal is obviously to match a couple in the end. That in itself wasn't a perfect fit for the brand, but there was a big travel aspect to it.

19:04And there was a lot of exploration, different trips every week. Candidates were going and exploring the world. And we focused on exploring nature, discovering, sharing good energy. It worked really well for the brand. Well, how fun. Now that we've satisfied my curiosity on the reality TV front, Shingli, I know that it's a hard question, right, for new founders when to actually start investing in brand. Because I think a lot of new direct-to-consumer brands, they do play around with smaller campaigns on digital platforms, on meta, what have you. Shifting that investment to brand is hard. What do you think founders should think about before they go towards brand building?

19:46Yeah, I would say they should think about brand building almost before they even push out the MVP. And because I think it's not so much about brand building, but the first step is really having a clear brand positioning. So thoroughly researching and optimizing your positioning up front, I think especially for emerging brands in the CPG space, everything, all of your touch points should shout towards this North Star, the ultimate story that you want to tell to your consumer, right? And so, especially as a emerging brand, packaging and formulas become one of your biggest billboards. 100 % of your consumers will see your packaging, whereas only a portion of those consumers will see brand building content and the advertising.

20:33And so it's all got to touch and connect through a very, very thick thread. The thing with, I think, launching before thinking about brand building is that it becomes really expensive and disruptive to try to decouple the two. And so I would say, you know, really once positioning is solid and validating, meaning you have a solid product that has an MVP, a clear consumer that you want to tell the story to, and a clear understanding of the story and the values and the mission that stands behind the brand. Then I would look at your early stage indicators, right? Repeat rates, consumer comments, consumer feedback, what's driving organic referrals.

21:16And once those signals are there, I would say that would indicate like a period of genuine brand resonance amongst your community and initial what we call traction, right? And so at that point, I would look into scaling investments into, you know, the channels that are closest to your core, core consumer. And of course, for our audience, MVP, minimum viable product is so important when you're starting to build a brand. That like kind of is a good reminder to have a good foundation for your brand and your business because you kind of have to build everything on top of that. And then I think, you know, we talked about how crowded the market is.

21:57And I think even like throughout the last decade, it's only gotten more crowded and there's still even more people trying to enter the beverage industry. industry. Carl, for you, you've seen so much within the industry change and there are competitors that are also trying to do what Guru has been doing for such a long time. How do you think about scaling now, despite the fact that things have only gotten more competitive and more concentrated? Yeah, first, it's always been very competitive. So it always feels like there's a new brand. There has been thousands of brands that have tried to be successful in this industry.

22:37So this new competition is not new. There's still only a few brands that are really generating the bulk of the sales. It's really still highly concentrated in four, three or four brands. There is more noise around this. And there is some brands that have this perception that some new players have come that have a perception of being healthier. When you really take a deep dive in the product itself, still a long list of artificial ingredients instead of a short list of natural ingredients like we use. So from a product perspective, we remain very differentiated, and that's really important for us.

23:14And I'd say we just double down on that, making sure that consumers understand that the product is differentiated. But as we said earlier, having the best product is not enough to win. So it goes back, again, I'll repeat a little bit what Shingli has said. And once you understand this, then we go back to the consumer insights we have. And again, there is not that crowded as well. When we look at consumer segmentations and the segments we go after, there are only very few brands that really resonate with that consumer. So we go in and we obviously market to them in a very different way. So different product with a very different brand positioning.

23:55Not doing what the others are doing, being very focused on pleasing that consumer because we know exactly who they are. and then when you take that angle, a very different product, a very different brand and you remain very laser focused on that, it's not that crowded. Obviously, if you try to target everybody, then you're going to find it very crowded. It's a huge industry, right? It's$23 billion in North America. So we've been able to reach 15 % market share in Quebec. We're a much smaller brand outside of Quebec, but we're the number one organic energy drink brand on Amazon. We're the number one organic energy drink brand in Whole Foods.

24:34We do well in a natural channel in the U.S. So obviously we think there's much more potential for this brand to become a little bit more mainstream. Yeah. I like what you said about bringing Guru to more mainstream arenas, retailers. And I think that's also a kind of like a mental shift for the team and also maybe differently how you work with speaking to customers. So for Shingli, is there a shift within marketing strategies as well when you're trying to be, quote unquote, more mainstream and has like working with different influencers or partnerships help to kind of pivot and position Guru as more mainstream?

25:16We have to be very disciplined about balancing mainstream appeal with very clear targets of who our consumer is. I echo what Carl said about being laser focused, about who the key personas are, who are most capable in loving our product. And frankly, in the brand's last decade, there has been many shifts in terms of who the influencer roster or ambassador roster is. And for us, really, and the challenge I have in front of me is how do we balance this incredible heritage as a brand and also with a clear understanding of the communities we want to go after? What are the ambassadors and influencers that will best tell our brand story?

26:05Again, I think similar to content roles, we also have very clear roles with our ambassadors and influencers, right? Ambassadors help tell our long-term story. There are long-term partners who authentically embody these guru values, our mission and our lifestyle. And our influencers are more used when we have these tentpole moments and we want to push a trial or a conversion and help us expand our visibility. You know, oftentimes this is product launches given that innovation is very cyclical in our industry. All of our ambassadors and influencers in our roster tie to the brand positioning with the clear North Star and message.

26:49So we're echoing through our network what story you want to tell. So obviously lots of opportunities, creators, influencers, and partnerships. How do you determine they are the right option for Guru? Yeah, we have a soft API that I think is so important, which is, does this person care about Guru? So really, it boils down to, is there a values match, a lifestyle match? And do you embody the good energy through, which is what we call our community and our brand principles? because it's my big belief that an influencer relationship should never be a transactional relationship. We almost treat them like employees in our payroll, real people who really live and breathe our brand story.

27:41Yeah. I mean, this is how we discover Guru is because the founding team Cozy, which is one of the largest, fastest growing furniture direct-to-consumer brands on Shopify, when they were opening their first retail location in Toronto, all of the team members were drinking Guru. They're from Montreal. So they were like, you got to speak to the Guru team because they just loved you guys so much. Well, I think like we've talked so much about, you know, growing within marketing and all of the changes. I wanted to also bring back to the start of the show when we mentioned how Carl was overseeing so much of the distribution expansion.

28:22The fact that Guru is the best-selling organic energy drink in Whole Foods, you have relationship with Air One, so many other retailers. How do you go to those meetings, establish those relationships, and also have them grow with you over the last decade? Relationships have always been important. They remain important. What has really changed is retailers are increasingly data-driven. So you need to have the data. Increasingly, they have access to POS data, not only from their retail stores, but also from the retail universe. And they see what's selling. Obviously, bringing more insights to what's happening in the retail world.