Not long ago, it would have been nearly impossible for a small brand to develop, manufacture, market, and then distribute its own products with any chance of success against traditional CPG retail giants.
Fast forward to 2018, and you have a very different story: direct to consumer brands have launched in nearly every niche and vertical to bring an innovative product and level of customer experience that big box retailers still struggle to create.
Here’s a look at four direct to consumer brands taking on the CPG industry — their stories, innovations, how they’ve mastered digital advertising and social media, and advice for aspiring direct to consumer pioneers.
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Serial entrepreneur Brian Levin was on an unassuming ski trip back in 2006 when a Red Bull spilled into his lunch bag — soaking his beef jerky in a concoction of caffeine, taurine, and sugar.
Chewing on the caffeinated jerky, Levin tasted what would become his next great idea: Perky Jerky.
Although the company would later drop the caffeine due to USDA regulations, Perky Jerky’s pivot to focusing on its proprietary process, distinct flavors, and unique texture have catapulted Levin’s novel idea into an enormously successful jerky brand that has rapidly expanded both in-stores and online.
With flavors like “Brewmaster’s Pale Ale Turkey” and “Heavenly Jalapeno,” Perky Jerky has carved out a name for itself as the jerky brand that is willing to take risks and push boundaries.
“We look at what’s trending in the industry and decide what to go after next. We just launched our Chimichurri and Sea Salt and Pepper flavors of Wagyu Beef Jerky because we know that our customers are interested in these flavor profiles.”
-Patrick Bernard, Director of mEatCommerce at Perky Jerky
Another value prop is the brand’s all-natural ingredients and emphasis on ethically-sourced meat ingredients.
“We buy only 100% grass-fed beef, cage and crowding-free poultry; we go the whole nine yards to protect the quality of life of our animals.”
Elevating The Customer Experience With Convenience
Direct to consumer brands like Perky Jerky offer more convenience to customers by making the transaction process simple and reminding the customer that they are valued.
“We are selling convenience,” explains Bernard. “At your desk, in five minutes, you can order the best jerky on the planet and have it delivered to your door.”
Perky Jerky also happens to be on the right side of today’s biggest CPG industry trends.
“Today’s successful CPG companies make authentic connections with customers — and there is no better way to do this outside of direct-to-consumer selling,” explains Bernard.
“By going direct, you can educate, answer questions, and follow up with them about their experience.”
A Small Team That Can Move Faster Than The Competition
Perky Jerky’s success is also owed to a lean team that can move faster than their big-name competition, enabling them to take risks and expand into new locations using an aggressive omnichannel model.
“Our ability to move fast means we can add new features, offers, and products to our site and Amazon in real time. We can always be on the cutting edge and meet consumers where they want to be met.”
Being present both in major retailers like Walmart and in online channels like Amazon have enabled the Levin and his team to reach customers almost anywhere.
Perky Jerky’s smaller team can pivot and develop new flavors in months, rather than years.
“For example, we came up with the Wagyu Beef idea in February, tested it in March, and had it on shelves by October. That’s a two-year development cycle for a larger corporation.”
Digital Advertising Amazon, Google, and Facebook
Levin and his team knew they would need digital advertising to reach customers that they couldn’t reach in-store.
“Our AMS spend allows us to match the most relevant products to the most relevant searches. We can interrupt someone in their purchase process and perhaps get them to try us, instead of someone else,” says Bernard.
“Our digital machine is a cash-positive marketing vehicle that will serve up 93mm impressions and hundreds of thousands of clicks to our site and Amazon next year. It is the most effective and efficient use of marketing dollars.”
Perky Jerky also leverages paid Google Search campaigns to rank for related unbranded and branded keywords to drive traffic to their website.
“Social allows us to prospect like no other. We can reach dozens of audiences simultaneously with messaging unique to that audience,” says Bernard.
“We’ve put out over 20 different videos targeting up to 30 different audiences. We use targeted messaging and humorous copy to appeal each audience.”
“We collect data from each campaign and use it to inform our next move. We have lots of data that shows that video can increase our engagement up to 4x, and our CPAs are fantastic.”
Want to learn more? Check out our full interview in Perky Jerky: A Digitally Smart CPG Brand Beefing Up The Competition.
The first Moon Juice shop opened on Rose Avenue in Venice, California in 2011.
But long before the brand won over the hearts of A-listers like Gwyneth Paltrow and Zoë Kravitz, the concept of “cosmic powders” to enhance your beauty, health, and even sex life seemed like a far-fetched idea for mainstream consumers.
It all began with Moon Juice’s first brick and mortar “juice bar” that sold a variety of cold press juices, cosmic snacks and modern pantry items like chaga, pearl, bee pollen, and reishi.
Today, Moon Juice is well on their way to establishing deep roots in the health and wellness community and their reputation for quality products and new age branding is flourishing among health-focused millennials.
“There’s a growing understanding that beauty comes from the inside out and Moon Juice sits at the perfect intersection of functional food, beauty and wellness.”
-Mila Aldrin, Director of E-Commerce at Moon Juice
By 2014, Moon Juice was ready to launch their ecommerce store including a line of adaptogenic herb blends (aka the Moon Dusts) all engineered to deliver targeted benefits to beauty, brain, sex, power, spirit, and dream.
Each Moon Dust can be mixed into hot or cold liquids like juices, smoothies, teas or coffee or incorporated into recipes like “Moon Dusted Maple Pancakes” and “Sex Dust Cookies.”
The shift from juice to powder-based products proved to be pivotal.
Not only could Moon Juice now store and ship their products, but they could market to new audiences all over the world — not just shoppers in walking distance to their juice shop.
Having all of that in one place is what sets us apart and how Moon Juice naturally became a mecca for plant-sourced beauty and well-being.
Branding And Demand Generation Through Facebook Advertising
Moon Juice has cultivated a strong social media presence and has leveraged that presence with paid advertising to build its branding and drive traffic to its website.
“Moon Juice has always had amazing results on Facebook, which shows that their audience has been waiting for a brand – and product – like this for a long time,” says Casey Edwards, Senior Social Marketing Strategist at CPC Strategy.
“But what’s truly special is the overall growth they’ve seen on the .com due to the awareness created around the brand on paid social.”
“In Q1 (2018) we saw a +27% increase from Organic + Direct in both sessions and revenue compared to Q4 (2017) despite November being the strongest revenue driving month to date.”
“This is attributed to the brand awareness created by paid advertising campaigns on Facebook and Instagram. In addition to those channels, they’ve seen strong growth metrics across the site,” says Edwards.
From Juice Bars to Major Retail Partnerships
Since the launch of their ecommerce store in 2014, Moon Juice’s has expanded their line of adaptogenic herb blends (aka the Moon Dusts) to deliver targeted benefits to beauty, brain, sex, power, spirit and dream.
Moon Juice products are currently available at Sephora, Nordstrom, and Barneys NY.
“We’re focusing on growing those relationships as we shift from a cold press juice & supplement company into a beauty and wellness brand,” says Aldrin.
Want to learn more? Check out our full interview: Moon Juice & CPC Strategy Partner to Reach New Audiences via Paid Social.
DIRTY LEMON is a digitally-native wellness beverage brand founded in 2015 that has sold over two million bottles, attracted an army of celebrity influencers and venture capitalists, and is now reportedly in talks with Coca-Cola.
DIRTY LEMON’s digital 100k+ followers on Instagram and Facebook has helped fuel demand for a growing variety of blends, boosters, and tonics — which promise to promote everything from anti-aging to energy and your immune system.
“At DIRTY LEMON we create full-flavored, functional beverages without the sugar and calories typically associated with a flavorful beverage. Every beverage has only 1g of sugar, which is naturally occurring in organic lemon juice.”
-Zak Normandin, CEO and Co-founder of DIRTY LEMON.
“Each product starts with a base of purified water, organic lemon juice, ocean minerals, and sea salt. From there, we add flavor and function,” explains Normandin.
They were designed to offer a healthier beverage to replace high-sugar, high-calorie options that are becoming a harder sell for today’s health-conscious consumers.
“Our beverages are created with functional ingredients that have been commonly used in the naturopathic community for decades — we’re blending them into a convenient ready-to-drink format.”
Taking Direct To Consumer To The Next Level With Text Ordering
Dirty Lemon’s beverages cannot be found on Amazon or in big retail stores because they are sold strictly through their “conversational commerce” platform that uses text message ordering.
“We aimed to solve an inefficient and antiquated distribution system — beverage distribution has had no true innovation in over 100 years,” says Normandin.
“We chose to create a direct-to-consumer beverage line where all orders are placed by text message.”
“At the core, we’re a tech company distributing beverages. Our proprietary conversational commerce (cCommerce) platform enables all purchases of our products by text message.”
“We believe conversational commerce is the future of consumer ordering — 75 percent of American Gen Z and Millennials prefer to communicate via text message. We have over 100,000 customers and have moved over 2 million bottles since the company started in 2015.“
An Enormous Social Media Following
Dirty Lemon’s Facebook and Instagram accounts have blown past the 100k+ follower mark thanks to clever organic and paid content on both social networks.
What’s more is that Dirty Lemon has cultivated a celebrity following on Instagram — which has helped fuel interest in the brand’s offering among socialites and influencers on the platform.
“We view social media as an outlet to continue direct conversation with customers in between orders,” says Normandin.
“We want to provide a platform that is an extension of the brand voice rather than an obvious advertising channel.”
Going Omnichannel: Cashless Pop-up Stores
Dirty Lemon opened it’s first “Drug Store” among boutique shops and upscale restaurants in Tribeca, New York this September.
Much like the rest of Dirty Lemon’s business model, the Drug Store is downright unconventional: there are no lines, no cash registers, and no staff to monitor the refrigerators housed with the brand’s minimalist bright-colored “beauty elixirs” and “cleansing blends” that retail at over $10 a bottle.
That’s because customers pay the same way most of today’s generation conversates: through text message.
“Customers simply walk in, take what they want from the refrigerator, and send us a text message of what they took,” says Zak Normandin, Co-founder and CEO of DIRTY LEMON.
“We’re moving beyond experiential marketing and into experimental — this type of engagement enables the convenience customers have come to expect from our brand. Our customer prefers conversational interaction — we’re committed to a transaction process that eliminates all unnecessary steps.”
Pop-up stores and experiential marketing are just the tip of an otherwise enormous digital iceberg: the brand has cultivated a 100,000+ strong following on both Facebook and Instagram — and has a particularly strong presence within the highest echelons of Instagram’s socialites.
Want to learn more? Check out our full interview in How Zak Normandin Is Reinventing Direct-to-Consumer CPG With DIRTY LEMON.
Not long ago, Craig Elbert found himself stuck in the vitamin aisle searching for vitamins for himself and prenatals for his wife, who was pregnant with their first child.
The experience prompted Craig to envision a vitamin brand that truly offered guidance and built trust with its customers.
Craig took the customer experience of vitamin shopping and turned it upside down with subscription-based vitamin packs that are delivered right to your door — all based on a simple questionnaire you fill out on Care/of’s website.
Each box is delivered right to your door and has a designer-esque look to it, complete with your name and a fun fact on the packaging — little things that go a long way in differentiating a brand.
Personalized vitamin packs start at $5 — and prices scale upward depending on what you add to your box.
“It made sense to shift this category online. There’s more room to give customers the information they need about the vitamins they’re considering, like what clinical research has been conducted on a particular product or how it’s been used in traditional medicine.”
-Anu Verma, Head of Marketing at Care/of
Verma also notes that customers who buy CPG products are often repeat purchasers, making Care/of’s vitamin business a perfect fit as a subscription service.
“It’s also one where many consumers find it easy to get on a subscription, rather than have to return to the store periodically to stock up.”
Care/of’s consumer-first approach is helping the brand carve out a place in a market projected to be worth $220b by the year 2022.
Care/of Leverages Digital Advertising and Social Media
Effective use of social channels is another trait of today’s growing direct to consumer brands, and Care/of is no exception.
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Today, Care/of commands a loyal following of over 80,000 on Instagram and also has a presence on Facebook and Twitter.
“Instagram is a great place for people to get to know our brand more deeply. We have an opportunity every day to share content between our stories and our posts.”
“Our community has grown steadily and we have strong engagement. If people enjoy our content on Instagram, that’s fantastic. If they engage enough with our brand that they become curious about trying us out, even better,” explains Verma.
Having a presence on social media is one thing — but being able to drive traffic to your website is another.
Care/of sees value in both, and uses both top funnel social campaigns and Google Search to drive performance.
A full-funnel approach to advertising means generating awareness using top-funnel drivers like Facebook and Instagram and also driving lower funnel conversions on your website when customers research your brand on Google.
“We have a fairly broad set of channels at work to support customer acquisition, and our priority is generally to generate strong top-of-funnel awareness among our target audience,” says Verma.
This omnichannel presence is critical for creating a seamless customer journey in today’s digitally fragmented landscape.
Want to learn more? Check out our full interview in How Vitamin Startup Care/of Is Taking on the CPG Industry.
1. Data Is Your Friend
The biggest strength that digitally native brands have over their traditional counterparts is the power of data.
When a customer checks out on a website, data-savvy direct to consumer brands generate a wealth of information that they can then use to inform everything from marketing to product design.
“There’s a wealth of data available to brands who leverage online marketing channels to understand the behavior and engagement level of the typical user on site and the relative cost of driving a purchase or a site visit. Leverage that data.“
“Listen to your data. Do not make a decision based off the feedback you received from one Facebook user who says they make better jerky at home,” says Bernard of Perky Jerky.
“Understand what your data means to decisions in your business. Analyze and understand your advertising data.”
2. Focus On Your Customers
Today’s wave of successful digital brands all focus on the customer experience that builds lasting relationships.
“Digital brands have a unique ability to develop a connection with the customer — through communication via email, or the development of a following on social,” says Verma.
“Care/of knows its customers on a first-name basis — and shows it on every package. What are you doing to build relationships with your customers?”
“Focus on the customer,” repeats Normandin.
“Create a customer experience that builds brand value while pushing the boundaries to provide the utmost convenience.”
3. Differentiate Your Brand From The Competition
If you are going to survive in today’s competitive marketplace, you’ll need to develop a presence and message that resonates and advocates for your audience.
Care/of differentiates itself in just about every way — from its subscription model to educational content, to packaging and intimate customer stories.
“Finding unique ways to engage the customer is another way to set your brand apart from others in the space,” explains Verma.
4. Always Be Optimizing
Today’s retail industry is relentless, and the brands that succeed are relentlessly improving on their business to keep an edge on the competition.
“Always be optimizing and never settle If you hit your goals, set new ones right away,” says Bernard.
“Being asleep at the wheel is a good way to get lapped. As soon as your competitor figures out what you did, they will do it better and you will be done.”
5. Fail Fast and Learn Fast
One of the key advantages of smaller direct to consumer brands is their agility — something that established CPG giants lack due to bureaucracy and inefficient hierarchies.
“If it doesn’t work, kill it. Kill it fast,” explains Bernard.
“Do not hope a failed campaign is going to work because you invested time or money into it. Fail fast, and learn something from your failure.”