How "Taste to Retain" Built a Billion-Dollar Supplement Brand

21:55Hannah Dittman:So I love how rigorous you guys are being about that and thinking about it. Juliet, you've had such an interesting career and I've seen so many different things. You've got deep CPG experience and you've gone trial by fire in a high growth startup. You're now part of a bigger, massive player in the space. You started out in a bigger player in the space as well. Do you have any best practices or lessons learned, pieces of advice from building this brand and from the rest of your career that you think other operators would find useful, helpful, or be able to learn from. Yeah, and maybe it's starting to sound a little like a parrot, but I think it really just comes down to customer feedback again.

22:31We can have many different hypotheses, but it's only as good as getting the actual feedback from the customer. So the more that you're able to involve customers or your target consumers into your process as much as possible, you know, it's like going out into the neighborhood and having people test it or using your loyal subscribers and asking them to give feedback on a new idea that you have for a product. So just trying to build customer feedback into your process as much as possible is what allows us to be more successful in our product launches.

23:03Hannah Dittman:That is so well said. I think in consumer, I mean, it's in the name, right? I feel like consumer packaged goods. If you don't have your consumers front of mind, you are just not doing what you need to be doing as a CPG or products company. So I love the commitment to that. Obviously, things go wrong in product development and manufacturing and R &D all the time. There's a ton of high risk involved in all of those departments and things that you've got going on. Are there any watchouts or best practices or things you would, either mistakes you've made that you've learned from or things that you make sure go right within your own team that you would share with the audience to double check on or maybe help someone else avoid a pitfall here and there?

23:45Mm-hmm. Yeah, this is such a good question. And it's things that I wish that I knew starting day one at Kroon's as well. But the more that you're able to bring technical expertise in-house and own those processes rather than relying on third-party vendors to be executing on those for you. So a couple of different examples that I have are we made the decision pretty early on to bring R &D in-house. Initially, we were working with our commands, innovators and labs to launch innovation. But this was kind of the first unlock in terms of product innovation for Grooms of how quickly we were able to move in terms of pacing, how control over products.

24:23But I think the other thing that people might underestimate when it comes to R &D is how important it is for quality control as well. When you own the SOPs and all of your formulas in-house, it really does make a difference in the type of things that you can hold third-party stakeholders accountable to as well. So R &D has been a huge unlock in terms of our quality continuing to improve as a company. Along those lines, I would also say the other technical expertise that's been really important to bring in-house is science and regulatory. And we've done this because we care a lot about product efficacy, along with ensuring that we're abiding by regulations set by the FDA.

24:58I really think about science and regulatory as a skill that helps you unlock growth rather than slowing down by putting regulations on yourself. So just being able to rely more on in-house expertise rather than rely on external factors.

25:11Hannah Dittman:Is there anything with gummies in specifically as a format that you think is particularly challenging or has hurdles that you need to overcome to make sure you get it right in the manufacturing development or R &D process? Yeah, gummies are tough, incredibly fun and rewarding, but it's also really challenging to work with in terms of I think texture is a really interesting one, where if it's too soft, you're going to have a tough time getting the gummies to actually come out of their mold. They're not going to hold up their shape very well once you're sending them out to your customers. You might see stickiness happening with the product.

25:45But on the other hand, if you go a little bit too far over a cure the gummies, you're going to have customers experiencing too much of the chewy toughness type of texture that isn't the ideal type of Haribo gummy like texture that they're expecting. So it's a little bit of a Goldilocks exercise in gummy of like getting it just right is what I found. But having a ton of discipline is one of my takeaways when it comes to things like the product specs that you are holding your commands accountable to. Having as much documentation and the quality processes written down is how you're able to protect yourself.

26:21And I'm sure that translates to more than just gummy category of like the more that you are being proactive with documentation, the more you can allow for consistency as well.

26:30Hannah Dittman:Very well said. Yeah, I'm sure even that sometimes there's coding on the outside of gummies and choosing the right one for that. whether it's going to be a wax or something else to protect it in packs that they don't all clump together. I mean, I'm sure there's so, and temp control as you're shipping out and warehousing. I'm sure there's so many different things that you are all thinking of that make it quite the challenge that you don't realize maybe on the surface. When you're thinking of product extensions now, and obviously you guys are exploring so many different things, how do you evaluate which product ideas are worth pursuing and which ones you decide to kind of leave behind?

27:03Hannah Dittman:What makes you all get conviction in the pursuit of a new product line extension or category entirely. Yeah, this is such a fun one, too. Like, it's one of my favorite parts of the job of being able to, you know, choose a new category and positioning. But ultimately, the biggest question that we ask ourselves is, do we have a unique differentiation within this category? Do we have a right to win here? And some of the factors that we're looking for are aspects such as, you know, it not only is the categories seeing growth and consumers are engaging, but is there a met need that the consumer has that we could be capturing?

27:37Is there a space for gummies to be playing in that allows people for more convenience and daily adherence and enjoyment with the product? So it just all comes down to whether we believe that we have unique positioning within the category or not. And that comes in the form of, you know, not just the product team, but we need to get marketing input. And I find that whether the marketing team is excited by the positioning or not is one of the most important factors of whether the rest of us should be excited by it or not. And our founders chat tends to be really involved in innovation and always has really unique perspectives on the positionings that we can be taking.

28:11So I would say like being doubling down on your positioning and being really clear on it. So one of the things that I've learned with Grooms is that not every bet that you take ends up flourishing into a product launch. So ensuring that you're diversifying in terms of the number of R &D projects that you have in mind versus the number of product launch slots that you have in a given year. That way we're able to launch the best sum of products that come into fruition versus just betting on the idea and hoping that it will turn into a great product.

28:39Hannah Dittman:Yeah, and I'm sure it's interesting the position you all are in where world's your oyster and you guys could probably make anything under the sun you wanted to. I mean, you're well capitalized, you've got a ton of reach, you've got the team you need behind you, you've got a lot of support. I think the journey for you all probably becomes a lot more about what not to make almost more than what to make sometimes. I'm sure there's no shortage of ideas of where you could extend your brand and the different flavors or innovations or different formats or different things that you could do. And I think there's probably a lot of conversations being had about what makes strategic sense for you all long-term and where you want to continue to grow this brand.

29:16Hannah Dittman:But I'm sure those are really fun chats to be thinking about. I feel like everyone who works in consumer loves the product ideation, like new product journey. building something new and thinking about the new ideas and how to figure it out is so exciting. If you were to restart Grooms or go work at a different company now, what would you prioritize if building a consumer product company from scratch today? If you were going to start all over or give a brand new founder a piece of advice, what would be thinking about or prioritizing? It would be two factors. And the first one is more important, getting product market fit as much as possible.

29:54And I think Chad went about it exactly in the right way of having the idea, but prototyping, getting feedback of that's what I would spend most of my upfront time on is getting the product right of ensuring that it really is meeting unmet consumer need. And is it going to be something that has a potential to have a strong customer lifetime value because people keep coming back to purchase it again? The second factor is a little bit less sexy than product innovation. But the more that you're able to have processes and documentation up front and make that a priority as your company, you know, scales into becoming a hundred million dollar, a billion dollar company, the processes that you have in place up front really protect you and scale you for the future as well.

30:39So thinking about documentation, processes, SOPs, the kind of contracts that you have with co-manufacturers and partners, like that being a priority more upfront.

30:49Hannah Dittman:Very well said and great pieces of advice. I'd love to double click on processes and documentation. I know we've touched on that a couple of times. If I'm less familiar with ops, or maybe I haven't done it before, what specifically are kind of the broad categories of documentation or things that I should be having top of mind that I want to make sure are being written down or that the process is being documented or going the right way? Yeah, great question. And I think about it in two big buckets of formula and packaging, and there are much bigger quality consideration. Quality is such a difficult job to have.

31:24I think about it in those two types of world. As it comes to formula, it's a couple different factors of like one is formula ownership of do you own the proprietary information as it relates to your formula? And we own all of our formulations in house stock rooms. And that gives us a ton of protection of ensuring that competitors can't come in and make a similar product or ask one of the manufacturers to make something really similar. So formula ownership, but also ensuring that you have tight documentation of how to make the formula consistent every single time as well. And that comes in the form of product specs in the kind of SOPs that you might have, manufacturing records that you hold with your co-manufacturer, but really buttoning those things down.

32:06And with that also comes formula version control too of ensuring that you know exactly at what point you transition from a B1 to B2 formula that you're able to look back on those records even two years backdating. And I think this is something that we have a really great handle on at Grants, but it also took time for us to build out these documentation and processes as well. And then as it relates to packaging, product is interesting in the sense that people might think that it's more so on the marketing side where there's risk exposure for the company. I think it's actually more on the product side because packaging tends to be more permanent than just being able to take down an Instagram ad that you might have out there.

32:45So being really buttoned down in terms of claims that you're making on packaging, ensuring that there is 100 % accuracy in what you're putting down there. And similarly, version control across packaging, having that documentation process set up from the beginning. So you know exactly one version went into the world and then second one transition, being able to look back on that data.

33:04Hannah Dittman:So well said, Julia. And you're singing music to my ears. Unless you're in it or have done it, you might not realize how quickly and crazily this all gets messy, especially when you're doing 50 plus submissions, when you've got a lot of different variables that you're tracking for product feedback across all of those. And then you've got a lot of consumer feedback and market research coming in at the same time. The changes can be really slight and sometimes they go in the wrong way between submission and the next submission. Or you had a retain that you were trying to match on one attribute and then you're trying to compare it again.

33:38Hannah Dittman:And you're like, wait, which submission number was that? What version was that? Was the viscosity right compared to that one? What was the RPMs we did? Actually, no, the heat was there's so many things. It's like cooking a recipe, right? And if you didn't have your recipe written down and then you're trying to recreate the dish and improve it even. That's really hard. Or it's two years later going back to remake that dish or make a slight change to that dish if you didn't have the exact recipe written down as clearly as possibly. Maybe even with a video of what you did. And same thing on packaging.

34:11Hannah Dittman:Sometimes even color compare, I'm sure you know, like comparing between a Pantone shade might be so slight or the one place you moved to claim or the font size or the small little error that you fixed or something like that. So I think there's so much detail orientation that happens on the product development and manufacturing side. Ops is all about fixing problems before they happen and knowing what's going on. So tons of respect for all that you're juggling and how quickly that you're doing it and how on top of it you are. It sounds like you are running a very tight ship over there. Is there a product decision that you've made in your career that you think had an outsized impact relative to how small it was?

34:52Hannah Dittman:Maybe you made a small decision that ended up having a huge impact that you didn't expect it to or something like that that you can share. Yeah, definitely. It comes down to bringing R &D in-house, which I had talked about briefly before, but the founder's decision and my decision to bring R &D in-house, we were focused more on the innovation front of wanting to scale innovation faster. But I think this was really why it kickstarted showing the need to have technical expertise be in-house and the outsized impact that it has when it comes to things like quality and having IP ownership, various aspects like that.

35:30So it really showed for us the small investment that you can make upfront, how it pays really dividends by being able to have control over how you are scaling the business and having consistency within your product org.

35:43Hannah Dittman:Yeah, I think so much more control you probably have and moving at lightning speed. I'm sure day one of Grooms versus day whatever you're at now where you're on the show are completely different experiences as you're walking through that job and how much more support and agency you probably have now with so much function internal to the company. We've spent a lot of time reflecting on the past and the journey of your career and your time with Grooms, but I'd love to pick your brain about what you're most excited about in the future of consumer product development in general, Grooms, or consumer behavior shifts, or the future of the industry at large.

36:19So many exciting trends. I think one that people don't talk about quite enough is AI and how it relates to product and CPG as well. I am excited for how much AI can jumpstart in terms of people will need fewer resources in order to build out a company to test out an idea and how much more we can try to incorporate AI in terms of how we are running product and running our processes as well. It's still, you know, baby steps that we're taking, but very much a focus for us, for myself and for the company in terms of AI being the focus.

36:51Hannah Dittman:Yeah, get that whisper flow going for all that PD documentation. Save somewhat a lot of time. No, I'm sure as you're talking about system processes, documentation, formulation, there's so many ways that AI can probably be leveraged to audit quality or keep better track of everything, find opportunities that maybe you're missing amongst amalgamating a lot of different consumer feedback. I think that is really exciting and it'll be interesting to see what the unlocks become in the PD space. Well, I could ask you a lot of my own questions that I still have. I love chatting with you, Juliette, but I do want to get to a Slack case study question.

37:31Hannah Dittman:As you know, Startup CPG has the largest Slack community in the industry with now over 40 ,000 members. I'd love to pull a question directly from our channel and have you answer it as a case study for any founder that might have a similar question. Today's question is, how do you know when is the right time to make a change to your product? It's such an important question and like one that I've struggled with throughout my career as well. But to me, it comes down to pattern of customer feedback and being close enough to customer feedback to recognize when there is a pattern of when a new product launches.

38:04I am in our review system on a daily basis, just like reading new reviews that come from our customers. And oftentimes that data comes first before you even have retention metrics to measure against. So being able to pick up on customer feedback by being close to it, but at the first opportunity that you notice a pattern, then it should be the question of, does this make sense to be implementing? Will this have a positive impact in customer retention? Will it have a positive impact when it comes to customer lifetime value? So just always asking yourself that question. But first of all, looking for the sense of any pattern that you're seeing in what you're hearing from your customers.

38:41Hannah Dittman:When you think about making a change like that, let's say you're getting customer feedback that the texture isn't as soft as it used to be or something like that. And you come to the decision point, OK, we need to change texture. How do you go about making a change when you already have the product in market? Yeah. So we've actually had a similar scenario to this where we launched the product. The flavor wasn't quite in the direction that customers wanted. So we iterate really quickly on it of looking at the entire formula again, what are causing some of the flavor notes that customers might not be excited about and what are changes that we need to be making.

39:16So from the time that we realized there was customer feedback, which was within a month of the launch, we launched our new product within six months. And it wasn't just a simple flavor change. We've actually changed the entire formulation around it so that it would be a more favorable experience for the customer. So just identifying it quickly, but also aligning as a cross-functional team that it is a priority. We received so much help from our operations team, from our go-to-market team in making this change. So it wasn't a product alone type of exercise, but the entire organization knew it was a priority, which is why we were able to make it happen in six months.

39:50Hannah Dittman:Yeah, I think the devotion you all have to meeting consumer needs and consumer feedback echoes across your company and clearly is a big driver of your success as well. I think everything down from like A-B testing marketing messages you're going to use in your ads and things like that to clearly product feedback, which anyone who's made a product knows that's no easy feat to be managing the existing inventory, making a change within six months, essentially relaunching your product and coordinating all of that like that is hard to do. But the commitment to making sure that you're delivering what your consumers want, I think, is very clear.

40:26Hannah Dittman:Your North Stars of consumer feedback and diligence and operations ring true through this whole conversation. And it's no surprise why you've been such the successful operator that you've been. Julia, this has been such a fun chat. Thank you so much for being generous with your time and insights. I'm sure you have an encyclopedia of knowledge that we could keep diving into. For any listeners that want to continue to follow along on your journey, glean your words of wisdom, or potentially reach out to you, what's the best way for them to do so? And second part of my question, do you have any advice for anyone interested in building a career in product development or potentially joining Groom's?

41:04Yeah, I'm pretty active on LinkedIn. You can find me, Juliet Choi is what you can find me under. And quite a lot of Groom's people are active on LinkedIn. So I encourage you to also follow our founder, Chad Janis. he posts a ton of really interesting content. And if you are interested in a career in product development, I would say like taking the initiative to share your idea even before you see a job posting is a way to stand out of product development is such a competitive industry in the sense that I just see so many strong candidates on a daily basis. But what really helps someone stand out is if they are like reaching out about a product idea that they might have, whether it's innovation or new flavor, different approach that we can be taking, you providing your thought process first allows you to stand out and see a really talented candidates.

41:50Hannah Dittman:And do you have any openings, Grunzer, with your team now? Yeah, we do have a couple openings that are going to be going out shortly. We have a couple of openings on the R &D team that should be being posted shortly. And then in a few months, there will be some more openings on the science and regulatory team as well. Amazing opportunity to work with the great Juliet Choi and hopefully learn from her under her tutelage. And I'm sure a really exciting time to be part of Groon's. Well, Juliette, thank you so much again for your time and your generosity with your insights. Really appreciate it and a pleasure having you here today.

42:25Thank you so much for having me. I had so much fun chatting with you. Appreciate it.

42:30Hannah Dittman:Well, friends, we've now arrived together at the end of another episode of the Startup CPG podcast, the top globally ranked podcast in CPG. And if you love this podcast, you'll love our Slack community even more. Here at Startup CPG, we're a community of brands and experts, and you should join. Sign up at startupcpg.com. You'll then get an invite to our online Slack community of over 35 ,000 all-star CPG members, hear about amazing events near you, and all our special opportunities to get you in front of buyers, investors, brands, and more. It's a free community. So what are you waiting for? I'll catch you on the next episode, and I'll see you on the Slack.

43:10Thank you.