Finding Our 2023 Mantra

We did! We made it through another year. I hope everyone had a chance to recharge over the past two weeks after a busy and tumultuous end to 2022.

Personally, it was great to unplug and hang out with my little guy for a few days.

He is currently obsessed with tree removal trucks since we had a few trees removed from our property this summer. Which led to him demanding that someone "cut down that tree" when we took him to Rockefeller plaza. Luckily we made him keep his distance. 

Now that the new year is upon us, I wanted to find another medium to help brands and I thought a newsletter would be the best avenue to impact brands trying to grow in retail this year. Our podcast, Honest Retail, is great, but it isn't really meant for tactical advice. 

This newsletter is going to be focused on how to effectively grow your brand in retail. We have a ton of interesting ideas to flesh out here and it is my hope that after each issue, you will leave with a handful of tactical actions you can take and apply to your business. 

Let's kick it off, shall we? 

But first, let's get you subscribed. 

One of my 2023 goals is to open my Calm app with more frequency. Right now it is just reserved for airplane takeoffs and a few calming minutes before a big meeting. I need to be more mindful daily and not just when a moment of panic or fear is slowly drawing near.

I feel the same way about business goals. They are much more effective when approached on a daily basis and the one mantra I want every brand to repeat daily this year is; Omnichannel, Omnichannel, Omnichannel. 

It's not news that the top brands are and will always be omnichannel, but 2022 reset our priorities and reminded everyone (especially investors), that you need to win both online and in-store to become a big brand. 

Let's recap...2022 started out fast and the sentiment in the CPG world was very positive as sales continued to increase post-covid. Even if your brand wasn't prepared for it, you most likely saw an increase in your online sales during that time. If your brand had a retail presence, then those accounts also benefited during that period, given the inflated demand for all products at the time. 

Money was pouring into DTC darlings (as it had been since 2008), valuations were fat, a decade's worth of consumer adoption was being packed into a couple of months, and everyone thought this was the new standard.

Because of that brand's kept deploying at the same rate, with the assumption that the ease with which they raised capital over the past two years was going to be there for them when they needed to re-up in 2022. 

But it wasn't...

Online sales began to slow towards the end of Q1, 2022. Inflation and fears of a recession started to creep into investors' heads. Rising customer acquisition costs due to iOS 14.5 collided like a runaway train with increased shipping costs, making it untenable for some brands to stay in business.  

The summer of 2022 was ROUGH for CPG brands. We saw DTC stalwarts like Haus close their doors. Investor interest had dried up and gone to the Hamptons until September. It felt like we all collectively had hit rock bottom after a two-year bender. 

Then as the page turned from summer to fall and as our feet touched the floor at Expo East, you could hear the same two words repeated in almost every conversation; omnichannel and profitability. 

That remained the theme at Nosh and BevNET live as every speaker talked about the importance of those two principles. 

We had collectively regained consciousness and with that clarity decided to return to the basics. 

It only made sense that these two pillars of any successful brand would become the buzzwords du jour for a climate where capital was dwindling and online sales were slowing down. Although these are common sense principles that most brands should be focusing on from day one, it isn't necessarily the playbook that was being rewarded over the past decade, especially since 2008. 

What we have seen rewarded with favorable term sheets recently are fast-growing, online-first brands, that prioritize growth over everything else. Investors were falling in love with the Allbirds of X and the Warby Parker of Y. They were backing ivy league grad students who were identifying market trends and product voids, versus operators who knew how to build a successful brand. 

That change in focus came at the expense of healthy margins, with most companies feeling like they could simply solve their margin issues when they hit scale. But then, almost overnight, we collectively reset. Investors started asking about margins, pathways to profitability, and what their retail plan was going to be.

Most brands just didn't have the answers or the runway to find the answers. 

So here we all are...It's 2023 and we have to go to work each day, building a capital-efficient brand around the tenets of omnichannel and profitability. Because, if your brand isn't moving toward those two things then you are simply moving toward the wrong goal. 

I am personally very excited about this shift and the increased long-term success rate it will lead to for brands that execute. 

We are going to tackle margins and profitability throughout Q1, but today, I want to focus on omnichannel. Specifically, what brands get wrong about omnichannel. 

Most brands feel that omnichannel is simply being available online and in-store for potential customers to purchase the product. Yes, in the most rudimentary way this is correct, but that isn't how top omnichannel brands see it.

Successful brands view omnichannel as complimentary pieces to their overall goals. 

The term complimentary football is thrown around by coaches all the time. It's when your offense and defense are...well..complimenting each other. The defense is getting timely turnovers and stops while the offense is capitalizing and turning them into points. No unit is perceived as better than the other, they are simply complementary pieces that are playing in unison so the team has the best chance to win. That is how you should view your omnichannel approach. 

On one side of the ball, you have online. This is where you can better understand your customer, capture them through multiple funnels, continue to build your relationship with them, and perfect your brand narrative. Your online channel isn't just measured by the growth in your online orders, but by the growth in your online community. 

On the other side is retail. This is driving a higher volume of your business, but it's more volatile and you have less control over the outcome because you are further away from the end consumer. 

Omnichannel clarity is achieved when you realize that both sides of your business should be working together. You should be constantly collecting consumer data and information online in an effort to push them in-store and you should work to have visibility into what's going on in-store so that you can continue to foster that relationship online.

It should be one breathing organism, living in harmony, not two separate beings.

This might seem like a vague, metaphysical description of how you should approach growth, but you would be surprised how many brands I work with where the head of retail and the head of eCommerce rarely speak to each other let alone gameplan together.

The other issue is that brands are hearing that they need to be omnichannel or focus more on retail and they are over-correcting, pouring all their time into just one channel, thinking it will save their business and gain favor with investors. We want you to find a happy medium. 

We are going to break down how to achieve this omnichannel state of nirvana over the next several issues, but for our first issue, we wanted to get everyone's headspace in the right mindset for the new year.

If you are going to win in 2023, the mantra you will have to repeat to yourself daily is; omnichannel, omnichannel, omnichannel. 

Author note: One of the things I want to focus on with this newsletter is helping brands perfect their retail pitch, deck, and positioning. If you want to submit your deck or a 5-minute pitch for me to review and critique in this newsletter, your can email it to [email protected]. I will do my best to be polite, but please understand that by submitting it, it will be reviewed publicly. Thanks, Cameron!