Make Drinking Water More Enjoyable: A Conversation with Todd Eichler, Co-Founder of H2wOw
Todd Eichler is a serial entrepreneur before bringing H2wOw (pronunciation: H-2-WOW) to the market with his wife Alison Tirone, and Tim Welch, a health food and beverage business veteran. H2wOw is an all-natural water enhancer with a mission to make drinking water more enjoyable. In a competitive ready-to-drink beverage market, H2wOw stands out with its clean label and simple, mostly organic ingredients, including extracts from real fruits without additives or anything artificial.
I spoke with Todd about how the product was conceptualized, why the team chose e-commerce over grocery stores, and his advice to fellow entrepreneurs.
Tell us a little bit about how the product idea was born.
The idea actually came from my wife Ali, who is a co-founder of the company. She had been working in the natural product channel until she became a full-time mom. She was working at SPINS, which is a data company for natural products so she was always looking for healthy food trends. She saw coconut water and stevia coming before they got hot so she is a very good trend spotter The idea was born because our oldest daughter didn’t like drinking water, and Ali was not happy with amount of sugar in kids beverages and energy drinks in the market, so she started experimenting by putting essential oils in the water to make it more flavorful. The essential oils are simply extracts from real fruits. Ali’s idea was to create something that was purely natural without any ingredients that a consumer couldn’t recognize or pronounce. She hired a formulator to help us further develop multiple flavors.
At that time, I was actually working with another consumer product company that I helped to start in the sports category, but I loved the idea and decided to join my wife and take the product to market. It was about that time in 2012 that some major brands created the “water enhancer” category and began educating consumers about the concentrate products and delivery systems but there were no natural options.
How did you decide to be all in while you were still helping to lead another start-up?
I have been a serial entrepreneur for the past 20 years, and another word to describe this is “unemployable.” I am so used to new ideas and creating things so this is in my DNA. I get excited about the process of creating a product from scratch, developing a brand identity and getting it to market,. The company that I was working on was based in NY and run by some very good friends and was growing to the point that it could support more of a full-time team. I was also energized when Tim Welch, who was the former CEO of Emergen-C and SVP at Hansens agreed to join us, and we decided that he and I needed a full-time commitment to business to get this running.
A lot of us have great business ideas while having a stable and salaried job. What is your advice to an aspiring entrepreneur about when is the best time to be all in?
I think it really depends on your backup plan and if you have enough time, resources and runway to be all in. I would say in San Francisco it is extremely difficult (laugh). That’s why you probably see a lot of food start-ups in places like Boulder, where the cost of living is more reasonable while still having an amazing talent pool. At some time you do need to dedicate your time but make sure you have done enough homework to prove that there is a need for your product and that you are solving a consumer pain point.
Another lesson is that getting your product on shelf is not the time to be doing victory laps. Just because you sell into a place like Whole Foods doesn’t mean you can maintain that momentum. It is more about the sell-through. When your products are on the shelf, that’s when the hard work just begins.
What were the biggest challenges you and the team faced, and how did you solve them?
Well, I can give you a couple challenges (laugh). The first one is being natural while also being shelf-stable, so that is more on the technical side that Tim is uniquely qualified to drive. It is very easy to throw in all kinds of preservatives but we purposely chose not to go that way. We went through hundreds of iterations and decided that the consumer would prefer something that does not have artificial ingredients, but that would be at the expense of having a potentially shorter shelf-life. That’s the first lesson: being natural is not easy.
The other one is distribution, especially when you are boot-strapping and trying to keep your costs under control. We decided not to be in retail, because of all the costs in the supply chain so we started with e-commerce. The growth of Amazon has enabled many small brands to get to market quickly and have a national and even international customer base, but it doesn’t mean you can simply put your products online and expect the register to ring. I spend many hours each week trying to optimize our listings and ad campaigns. Trying to understand how to make your brand rise to the top of Amazon search (and stay there through constant algorithm changes) really could require a full-time person.
Many food entrepreneurs launching better-for-you products usually pick Whole Foods as the first step, you purposely avoided the grocery segment. Can you share more insights behind this decision?
It is amazing to be in Whole Foods, however, as I mentioned earlier, it is not about sell-in, but about sell-through. It is important to have the plan to maintain the velocity once you are on the shelves which should include an aggressive sampling and marketing campaign supporting each store. That can get very expensive. And knowing the category and which shelf is going to be is also critical. When we were starting out a few years ago, none of the other brands were qualified for the natural channel, so there was no clear buyer! We would probably have been sitting with vitamins and pills in the supplement section. That would not set us up for success.
Another suggestion is that really researching what might be around your product on the shelves. Spend quality time visiting the retailers and seeing what the packaging looks like in your category before you finalize your packaging design.
Besides the 2oz bottle, you also have the 11oz bottle which is for companies’ snack program, correct?
Yes. It actually a result of listening to our customers. One of the major Silicon Valley tech companies reached out to us and asked if we can provide a bigger bottle, as they were concerned about employees walking away with small bottles. They asked if we could do a “foodservice” size. This is great because it also helps limit the environmental impact as our 11oz sku now provides 125 servings in one bottle.
That’s a great example of listening to your customers and acting upon their feedback. What other advice you will give to fellow entrepreneurs?
Be very passionate about your product and what you do, because it is often not a glamorous business, especially in the food & beverage sector where margins are often low.
Make sure your product is differentiated. At the end of the day, that’s the first question your consumers and investors will ask you. You need to know the answer to that very well. Know your market very well. In our case, it is great to have Ali as a partner and the voice of the company because she is an active mom who is an avid label reader so she is representative of our target audience.
Be flexible and listen to the feedback. We are constantly making changes to our formulations because consumers are the decision makers.
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