Top Expo West Trend: Restraint

I hope everyone enjoyed Expo West 2023! It was great to see so many online friends and colleagues in person.

Personally, I love Expo West, it acts as my annual reminder that I made the right choice when it comes to the industry I want to be a part of. I remember being so lost after college and not knowing where I wanted to build my career, but somehow, I ended up in the perfect place for me, and Expo West always serves as a time of gratitude and reflection for that.

I didn’t know what to expect from Expo this year. I know a lot of brands decided to drop out and I was expecting more empty booth spaces, there were some, but overall the vibe of the show was very positive.

We did have a bit of a buzzkill on Thursday when the SVB news hit and went from faint whispers to the only thing we were collectively concerned about.

The booths looked great, with Goodles and Belgian Boys stealing the show for me. It just felt like the angst a lot of us are feeling around the future of CPG was lifted for a few brief days, which I think many of us needed.

One of my favorite things about Expo West is the postmortem we get from every blog and industry newsletter (as in the one you're currently reading), which breaks down all the trends we can expect to see coming out of the show.

You will see everyone list their favorite flavors, trends, and new brands while making bold predictions about consumer habits in the coming months.

I love consuming that content post-show, and as I reflected on the show, I realized I had a much different takeaway than most, my biggest trend at Expo West was…restraint.

Booths seemed much more paired down than in years past. The marquee day two booths that were always gigantic draws on the bottom floor of the Main Hall were now opting for smaller booths in less desirable areas.

Obviously, there were still some monster booths with their entire teams present, but you could see a lot more brands took a much more measured approach this year.

This didn’t seem to affect the fervor around these booths and I would actually assume the ROI is going to end up being much higher than in years past.

I also saw an abundance of founders and teams opting to walk the show, with product in hand, versus paying for a booth. This is a great tactic and one more emerging brands should deploy.

I love Joy Milk Tea and I am a huge fan of their founder Max. He had a beautiful booth and presence last year and this year opted to walk the show, while still representing his brand creatively.

Some founders might be worried about doing this, thinking people might view it as a downgrade over last year, but Max is focused on amplifying his current retail account performance and less focused on new business, making this a great way to still be at the show, but not break the bank.

For the brands that did have a booth, the one thing I noticed at Expo West was that there was less innovation, which could sound negative, but I actually viewed it as a positive. Again, restraint on the part of the brands was in vogue this year.

In years past it feels like almost every other booth would be pushing a new flavor or line extension at the show and it felt like brands needed to have a big announcement ready for Expo West, and that usually took shape in the form of product innovation.

This year, I felt the Sanzo Pomelo flavor launch (which is in line with their current offering) and the Chamberlain Coffee RTD launch (which makes sense as their next move), were the two that resonated the most with me. I also enjoyed trying the new Lupii pasta and Must Love cookies, which were bigger product extensions into new categories, but still felt aligned with the overall brand mission.

Lack of restraint and focus on the part of founders, in any industry, can be the quickest way to zero. In CPG that lack of restraint usually takes place in the form of new product innovation.

SKU assortment is a constant dance, especially for CPG founders. Most founders, that I have encountered in CPG are product people. They birthed their companies in their kitchen, testing different ingredients and flavor profiles until they got exactly the taste and mouth feel they wanted.

Those founders then took that recipe to a copacker or moved into a commercial kitchen, where they painstakingly iterated on the product until it was ready for commercial production.

And all of that felt like progress, which it was, and not only was it progress, but it was progress with immediate feedback. Your significant other, friends, and family got to try it and tell you how great it was. These were the earliest indicators that you had something. They also fed into the inherent confirmation bias we are always looking for as founders, that our idea is a good one, and that others truly believe in what we are building.

The issue is years down the line. When you have been in market for some time and you are trying to achieve consistent sales growth from that original product.

Investor pressure and internal pressure begin to mount and a lot of CPG founders go back to what got them there. The love for product development.

They launch new flavors or completely new product extensions, and the same feedback loop from the earliest days of the company recycles itself and you again feel like progress is being made.

But if your new sales are coming strictly from innovation, that growth is always going to be discounted when you go to raise or sell the business.

To me, the best practice for brands and when it is time to decide on when to launch new products is setting a goal ACV% for each current SKU as a north star. There is a good breakdown HERE, but in short, ACV% measures how much of the total available market that your product is in.

If you are moving into new categories with a 5% ACV, it’s probably too early, if you’re over an internal threshold that you have set, say 30%+, then I think your brand can start thinking about new innovation internally.

The macro-environment right now is unsettling, but I do think it is forcing brands to go back to basics and focus on their core SKUs while tabling innovation until 2024.

It might not be the usual slide show breakdown of new trends that we all love reading after our annual trip to Anaheim, but hopefully, the principles of restraint and focus are something we can hold onto for the rest of 2023.