The Playbook for Companies in Emerging Categories

0:00If you say, yes, we're making a non-alcoholic drink, you have to enjoy it from the comfort of your home, then you're not fully being inclusive. The category was very new and people are very protective of what goes on their menu, but we really insisted we really want to be where our customers are. Hi there, I'm Shuang Esther Shan and this is Shopify Masters, your companion for starting and building a business. If you're selling a product that's innovative, you might have to teach customers not only what it is, but why they should use it and even how it should taste. That's exactly what Melanie Massarin had to do with her brand, Ghia.

0:38It's a non-alcoholic spirits company and it launched during the pandemic when people were drinking more alcohol, not less. Melanie is here today to share her secrets for how to market a disruptive product while cultivating a new customer base. Thanks for being here, Melanie. Thank you so much for having me. I'm excited. it. So Ghia really stands out and it's a very groundbreaking entrant in a kind of unknown category back in the day. Why did you decide to make non-alcoholic spirits? This company really stems from personal experience. I had a really busy job before the pandemic and sort of naturally stopped drinking for no particular reason other than I felt better without it.

1:26And I had a crazy schedule and I'm a little bit of a lightweight as well. And when I left my job, you know, I realized that I felt so much better without the alcohol, even if I had more time to myself and I had more time to socialize and go out to dinner. And I was often cooking for friends and I realized I always feel so excluded from the social occasion if I'm not having an alcoholic drink in my hand. And I felt like there was such a big disconnect between the way that we think about what we eat, which is like such a prevalent topic of conversation today and something that people are so accurately aware of and what we drink.

2:03Most alcohol bottles don't even have ingredient lists on them and we don't expect more from them and so I wanted to make a drink that, you know, I felt comfortable children drinking, I felt comfortable drinking every night, I felt was also really good for me and also was hitting all of the tasting notes and all of the flavors that I was craving in a more complex alcoholic drink, but kind of without the guilt and also something that would make me feel socially included. So I made it for myself. Love it. And set the scene for us, because I think when we think about non-alcoholic beverages, the scene back in 2019, 2020 was very different.

2:43What were some of the options that was actually available at that time? So actually, when I started working on it, which was at the very beginning of 2019, there was no such thing in the United States. But there were a few brands in the UK that existed. One of them was Seedlip, which is a company that I admire a lot because it's very hard to be first to market and it's really hard to educate a customer. And they've done a tremendous job. They were at the time probably a bit more like a gin alternative than a spirit alternative per se. I think they were really trying to mimic an alcohol that was already craved there.

3:20And then while we were working on the company in the United States, Kin and a few others launched that were really specifically addressing the topic of drinking alcohol. And it was great. They kind of helped us prime the market together. And I think when we think about non-alcoholic drinks, we might think of mocktails that maybe are a little too sweet. and you wanted to create this bitter spirit. So what did you have to do to showcase this differentiator and also educate customers on it? For sure. I think a big element of frustration for me would be that this first drink of the night, which I find is the most important because it really sets the stage for the evening and is when alcohol is, you know, we're conditioned to think of it as a social lubricant the most.

4:07You know, you would get to a restaurant and you'd be ready to have like amazing food. I was living in New York City. There's so much going on in the food scene. And I would say, like, do you have anything non-alcoholic? And they'd say, yeah, we have sparkling water, Mexican Coke, and, you know, we can make you a mocktail, which would be like orange juice and bitters or something like that. And I just didn't want all this sugar before dinner. You know, forget about the actual nutritionals of the sugar. I also wanted something that was more layered and traveled through the palate a lot more. And so that's why I was thinking when creating Ghia, I have all the different tasting notes that one maybe craves or asks when they're ordering their first glass of wine of the evening or their first cocktail.

4:46And it's something that's very different. So we always think in terms of one, the occasion, two, the tasting notes. And I think having a concept and ideas that you want to taste in a bottle is just the beginning. How did you carry out the process of actually developing the flavors that you dreamed about? I didn't even know where to start. You know, I hadn't created a CPG product before. And so I asked all my friends who work in food, you know, how to go about this. Do I need to hire a food scientist? Do I need to hire a chef? And they pointed me in a bunch of different directions, talking to formulators basically.

5:23And then one of them accepted to take us on. And, you know, there's, this is kind of where like the fun part of the job begins, even though you taste a lot of bad formulas until you find the one, but making it in the lab is actually sort of the easy part. And then after that is the commercialization aspect of the drink. So it's like scaling your recipe from the small batch that you drink where you approve the taste to something that you can actually produce at scale. Something that I found very interesting with Ghia is the fact that you were building up a community. You actually wanted to incorporate feedback that you were getting into the development process.

6:01how important was that for being in this emerging category and actually getting that direct feedback from customers it was super important i have a very specific palette and i always knew that and a very specific aesthetic and so i really wanted to create a drink that i was craving but that others would also be craving and the different flavors of drinks are very different between europe where i grew up and the united states so you know we were just talking about seed lip the kind of drink of choice there is a gin and tonic, which here the equivalent would be more of like a vodka soda, for instance.

6:36So different countries just kind of have different rituals.

6:43I grew up in a world that was very aperitif heavy. And in the south of France specifically, people drink a lot of pastis, which is a licorice based drink. And it's not a flavor that's very popular here. Before when I was drinking, like I love Campari soda. I loved how easy it was to drink. I love this kind of like fresh, bitter flavor. And so I wanted to create a sort of like new age, you know, bitter or Italian amaro that would just be kind of like better for you.

7:17I roped in all my friends and had them give me flavor notes. We asked so many chefs whose palettes we admired, whose food we loved for their feedback, you know, and it was a lot of feedback we collected probably, I think we poured a thousand Gia before we actually finalized the formula and bottled it. That's so impressive. I think there's so much to distill into your message, right? Your upbringing, the flavors that you preferred, the preferences from Europe. So how did you actually distill all of that and have a message that was clear that you can educate customers on? It's difficult. It's very difficult to educate people on a new category.

8:00It's very time consuming. So, you know, you almost have to distill your message to simplify it as much as possible. And also the visual language of the brand is so important because there's a lot that can be passed on very subliminally. And so for us, it was like, how does it look? How does it make you feel when you look at it? Can you say the word guia in a lot of different languages? Is it a happy word? Is this something that's very positive? The drinking culture in Europe is very celebratory. And I find that it's something that's a little bit different here. There's sometimes this concept of you are drinking your sorrows away or you're drinking because you need it.

8:38And that's something that we like absolutely didn't want to integrate with the brand. So we decided that, you know, we wanted the brand to be very positive and we wanted to never even really talk about encouraging people not to drink, like not being preachy was something that was really important to us. So it's almost like doing more work in distilling the most. And the end result is a few short taglines and a few short words because they're easiest to integrate for people. I love your catchphrases and I'm very excited to get into them later on in the show. Before we get there, there's also a lot of unique ingredients that goes into creating Ghia.

9:14Tell us, how did you select those ingredients? Well, one thing that was really important to me was to create a drink that would be made with only real ingredients. I didn't want any ingredients that people wouldn't know what they are. I didn't want any ingredients where, you know, anyone would have to limit themselves in how many drinks they could have in the evening. I really wanted this to feel like a good for you drink without feeling like a healthy drink. So not a lesser version of an alcoholic drink, not a wellness drink, but something that you truly could enjoy as much as you wanted and very liberally.

9:53And so for us, that meant not using flavoring, not using artificial flavors, not using, you know, components that one couldn't read. And so it was just using pure juices and extracts. extract. The extract is what allows us to make this drink taste very dry, which was really important from a flavor standpoint. And so it was very difficult at first because if you use pure extracts and juices, they can interact with each other. You have to keep your formula as stable as possible and you don't have the alcohol to preserve it. So, you know, it took us a really long time to create the first iteration of Ghia, but we're really proud of it.

10:31But it also means that our margins are very low and our ingredient costs are really high. And that's something that we're just betting on the fact that this will be a significant differentiator long-term as people come to expect more from what they're drinking, or at least as much as from what they're eating. And talk to us about the pricing side, because I think there is a bit of a justification in the education process where the pricing is comparable to an alcoholic spirit, and people sometimes have this misconception where they feel like a non-alcoholic beverage should be somewhat cheaper. Yes.

11:06So this idea of value for the non-alcoholic category is very interesting because the function is often where people perceive the value. So we hear a lot like, oh, it's as expensive as alcohol, but it doesn't get me drunk. Right. But if you think about the price of an alcohol bottle, what you're paying for really is not the ingredients.

11:28You're paying for a lot of taxes. You're paying for a lot of marketing. You're often paying for the product placement behind the bar and our ingredient costs are probably, we estimate between six to 10 times that of an alcohol bottle. It's obviously there's a wide range within the alcohol world. So this is a very broad generalization, but using a bottle full of pure extracts and juices is obviously going to be extremely expensive, way more expensive than a bottle that has like 30 % ethanol in it. And so that's a consideration that we have to educate customers on a ton.

12:08Well, very excited to learn more about Ghia and dig into the branding side of things. My guest today is Melanie Massarin. She is the CEO and founder of Ghia. I'd like to take a moment and thank you for listening to our podcast. If you're new here, make sure to give Shopify Masters a follow or subscribe to the show wherever you are listening. You can let us know your thoughts by leaving a review. Thanks. What I love when I mentioned about the catchphrases, especially, is the beginning of over the influence that you use so much. How did you end up with that phrase? And what was the process like when you were thinking about branding and the words that would match what you wanted to kind of share?

12:55I think there's been so much marketing around alcohol and specifically around how it's supposed to make you feel and how it's supposed to make you feel like your better, most social version of yourself that, you know, I think we're conditioned to think that if we're not drinking, we're having a lesser experience, an experience that is more tame, an experience that has less belonging, an experience where there's less acceptance. And we really wanted to break that stigma. We actually always say that our mission for the company is to take back the word drinking from alcohol, such that people will use drinking to just drink any drink.

13:28Whereas right now saying like, I'm drinking will automatically say I'm drinking alcohol. And so for us, you know, it was really important. The term under the influence, like obviously is very strong, but we wanted for people to not feel like they were having a lesser version of anything. And it was kind of like an easy play on that term. And it sounds like an elevated experience. And I like the fact that every single section of your website is very smart with its copy from things like a drink to remember or how you're asking for people to subscribe to your emails to say, we're booze free, but our emails are intoxicating.

14:07So I really love how all of the copy has worked out. When you're working through the exercise of creating the brand and thinking about all aspects associated to it, what kind of advice do you have for founders who are trying to go through that process and actually getting all of the elements to be cohesive and tie back to the brand message? As a team, we struggle with it on the daily because we're so close to the brand. We know the ins and outs of the brand and all of the subtleties of the messaging are obviously come very naturally to us. And so sometimes it's like, we just forget to explain things that are really simple to customers.

14:46And so that's why customer listening is so important because sometimes it just helps you realize that you have to start from the very beginning for a lot of people. and so always like thinking through the eyes of the customer when looking at a page or looking at packaging you know if your product is just sitting on a shelf amongst many others like how do you from far sort of like intuitively communicate what it is and so that's something that we always have to think like we do it with every time we design something it's like okay like just think about it this is at a party on a table like you don't know what it is like does this make sense you know does it look the way that it tastes does it make you feel happy Does it make you feel like something that you would gravitate toward if you were at a party and you were three days into not drinking and kind of struggling to justify yourself to others?

15:34It's colors, it's graphics, it's messaging, it's everything all at once. And so we always have to remind ourselves that the people that discover us for the first time are many and are actually like most of the world right now. And so we have to kind of design Ghia for them. And speaking of the bottles, can you talk to us about the intention behind the design? Because it does feel like something that's meant to be displayed. And it's something that can fit in to a bar cart, but it also stands out at the same time. Yeah. For sure. We are so excited that we just relaunched the bottle with a custom design that's ours.

16:09It feels like grown up Guilla. And we also concentrated the formula 46 % more in the process so that we could offer a little bit more value to customers. always in the spirit of making this category more inclusive since a lot of people think it's a little bit expensive. So we really wanted a bottle that felt like a jewel, something that people would proudly display to not be embarrassed to be drinking because they're not drinking alcohol. So it always goes back to kind of making our customers the hero and using GIA as a catalyst for moments where we kind of help build them up. As someone who's listening to your story and they're trying to kind of distill some of the learnings you had, did you also have to take a look at what kind of bottles did exist in the alcoholic market and analyzing to say, well, our design can fit into a typical bar cart, but we're also doing X, Y, and Z to make sure that we're also different so that it is something that is unique?

17:10Yeah, actually. So there's a lot of different kind of shapes of bottles and codes in the alcohol world. And so we could have taken the path of, you know, using a bottle for a specific category that we feel like we're the closest to. You know, Mezcal bottles are a certain size, tequila bottles are a certain size, maybe not as much with Amaro bottles, which come in sort of all shapes of form. But we wanted a bottle that would fit beautifully on a bar cart, but would also have a lot of personality. And I think that that's part of our brand is we've had to be unapologetically loud because we didn't want, again, to be like a more tame version of an alcohol bottle.

17:53So that was something that was very intentional for us. So you also expanded into a lot of complementary product categories like the puzzle. There's also a hazelnut spread, some merch-like shirts and aprons. So how did you decide what products to make in addition to the Ghia spirit? Yeah, the puzzles were a holiday limited edition. For our own events and uniform, we had made those aprons and then people asked us where they could buy them. So we decided to release kind of a limited quantity on the side. But our process for thinking of new products is always like, what is the occasion? What is the moment?

18:33What is the product that is the catalyst for that moment?

18:41That's how the hazelnut spread came to be. That's how a lot of our products came to be. Obviously, our core products are always our liquid products, our beverages. But we always try to kind of surprise the customers with a few more. And then we have our glassware, which we're really proud of. We sell a lot of glassware and that was one that was, you know, a little bit like the bottle design. We always get asked, what glass do you use for Ghia? Because different types of alcohols are consumed in different drinks, whether it's a wine glass or a martini glass. And so we decided to kind of design our own and using the different codes for the brand.

19:15We wanted a glass that felt like it was luxurious, but also very approachable. So we designed kind of a stemless martini glass that was like a cone with the kind of Memphis style totem foot in different colors, something that would be kind of fun and very recognizable. And also, I feel like the glass is very cool in its design. Was it also another way that it's a little bit of integration on how customers should be enjoying Ghia or having like a more holistic experience where I'm using the Ghia glass in addition to enjoying a Ghia beverage? And we never want to be prescriptive with our customers.

19:55We just want to be here whenever they want. So I think a lot of people gravitate toward Guia because they also like our heritage of being a more European brand. And they're leaning into this delight of the early evening. And so there may be people that love to set a nice table and love to host. And so we were trying to meet our customers where they were with designing a beautiful object that they felt completed that moment. I really like what you are saying about meeting customers where they are. And I think that's where you also started to create Ghia in different cans and different flavors where there is the Ghia soda or the Ghia ginger.

20:42How was that process of realizing, hey, this is a point of convenience and also meeting the customer where they are? Yeah, so we actually had the idea for the Spritz, which is our little can, because we launched in 2020. And a big issue that we had with the businesses, because it was the pandemic, we were not able to sample anyone at any point in time. You know, we couldn't do any demos in any markets. There were no events going on at that time. And we also were getting a lot of questions from people about how to make the drink and realized like a lot of people don't know how to make the perfect spritz.

21:17So we launched our cans with one flavor, which is like literally the guia original is one part guia, three parts sparkling water and a sprig of rosemary. So we just spritzed it in a very simple way and it started selling really well. And also we realized people love to bring it for picnics and love to take it with them wherever they go and maybe even start their evening a little bit earlier with it. Like we hear of the mid-afternoon guia, whereas I think the bottle is maybe more of an evening ritual. So it was really nice. And from there, we kind of decided to create a few different recipes. And now you're actually expanding into working with distributors and restaurants and bars.

21:59How has that process been like? Well, it's kind of running a different business. It was always a big priority for us to be in restaurants and bars because part of our mission of being inclusive is for people to be able to enjoy a drink when they're out with their friends. If you say, yes, we're making a non-alcoholic drink, you have to enjoy it from the comfort of your home, then you're not fully being inclusive. At least that's our strategy. And so for us, that's something that was very difficult to do because the category was very new and people are very protective of what goes on their menu.

22:29But we really insisted we really want to be where our customers are.

22:39and so that was always our strategy but we were working with them directly like I personally I think opened the first 400 accounts for Gia by just like messaging chefs on Instagram sending emails showing up places and now it's really exciting to see that distributors are finally catching on to the category and we're able to scale a little bit more easily we rolled out in a few different chains. We are now in Sweet Greens in New York and LA. We are launching in some CVS, some Whole Foods, some Targets, all by the end of the year. So it's a big moment for us. And I'm really excited for people to be able to find us in more places and have the more spontaneous, you know, I see Gia, I buy Gia rather than having to plan ahead and buy it online.

23:24And so it's a really exciting time for not just Gia, but just non-alcoholic drinks and non-alcoholic drinkers in general. Sounds like it was so much grunt work and congrats on having these new access points for different customers of GIA. One thing I wanted to ask is the fact that when you're working with restaurants and establishments, I guess you have to kind of give part of the education to those establishments and hoping that they will be able to showcase the story. What was that process like kind of letting go a little bit of the storytelling and the customer education? It's for sure difficult, but I think we definitely reach out to restaurants where we feel like the brand fits the best and we believe that our customers will appreciate our product the most.

24:12So it can be either that the drink pairs well with the menu or the establishment already has an alcoholic category on their menu, or that we believe a lot of our customers are already going to this establishment, which makes things easy or easier. We never want to be discovered by someone on a retail shelf because that probably wouldn't set us up for success. The product is a little bit expensive for discovery purely. So we always have to complement with different touch points and make sure that the bar, the restaurant, the grocery aisle is only one of the touch points that this customer is seeing at any given time.