The Ice Cream Diet and 3 More Organic Marketing Tactics that Worked
There is no shortage of investor articles (including my own) about the importance of having healthy unit economics and measuring paid marketing efficiency when you’re building a consumer business. That said, at PGVC, we get the most excited about non-paid growth — meaning the strategies and channels you use to grow your business that are organic (e.g., word of mouth, PR, referrals).
As a rule of thumb, for consumer startups we like to see at least 50% of customer acquisition coming from non-paid sources.
When we compare winning brands (Honest Company, Dollar Shave Club, Interior Define) to those that have struggled, this trend in (lack of) marketing spend clearly emerges as a leading indicator of success.
Money Can’t Buy You Love
As venture capitalists, we’re in search of brands that have built something that customers love, and for consumer brands the highest expression of love is telling a friend (sharing = caring). This is the psychology that drives organic traffic. While everything starts with a great product and product market fit, in today’s noisy marketing environment it can be tough even for great products to get noticed. There’s no silver bullet for driving organic traffic, but here are a few examples I’ve observed of different approaches that seem to have worked:
1. Halo Top Ice Cream: The right PR
Halo Top ice cream was conceived in a lawyer’s kitchen in 2011, and has grown into a $2B brand in a crowded category with seemingly little room for new entrants. For those unfamiliar with the brand, through a series of recipe experiments in his home kitchen, Halo Top’s founder created what sounds like an oxymoron — healthy ice cream. Halo Top is a guilt-free, bingeworthy treat — a low calorie, low sugar, protein laden pint of ice cream. While this sounds like it should have flown off shelves immediately, it wasn’t until 2016 that sales inflected thanks to this GQ article: What it’s Like to Eat Nothing but This Magical, Healthy Ice Cream for 10 Days
If you don’t want to read the article, the story has a happy ending; the author survived, dropped 10 pounds, and hit a personal best bench-press set while on the diet. The article went viral, spawned copycat articles from people replicating the diet and Halo Top sales jumped 2500 percent that year. In 2017 Halo Top displaced Ben & Jerry’s and Hagen Dazs to be the top sold ice cream in the U.S. for a period of time. Halo Top was also smart about making their initial press hit last; they built their social media following, and gave their community reasons to stay engaged — after their online PR success, they stated using their social media channels to let users help pick new flavors. Today Halo Top has over 720,000 Instagram followers.
A whole article could be written on how to select a startup PR agency (a post for another day), but a trend we’re seeing with early stage startups is bringing this function in house (often it’s cheaper and more effective than outsourcing to a firm because it allows you to build deeper, longer-term relationships with reporters). And when you have a story that’s a hit (which you can usually quickly determine by looking at referral link traffic), you have an opportunity to amplify and sustain the story by sending it to other reporters and suggesting follow-up stories. Sometimes the fact that a story has gone viral itself is a story in itself.
2. Chatbooks: Funny viral videos
There are a number of companies that have crushed the viral video game. Original viral video mavens included Dollar Shave Club (Our Blades Are F***ing Great) and Hello Flo (The Camp Gyno). These videos garner millions of views, and can drive significant traffic to a commerce site. More recently, Chatbooks put the tactic to work for them:
Chatbooks worked with the Harmon Brothers, a Utah-based viral video shop which also produced mega-hit digital videos for Squatty Potty, FiberFix, Purple and Poo-Pourri. The Harmon Brothers services don’t come cheap (a video from them runs $500k per campaign). For those start-ups that don’t have this in their budget, this article does an interesting job dissecting the components of creating a viral video. Their recommendation is to:
- Use a formula: Headline, Problem, Solution, Guarantee, Call To Action, Social Proof, all wrapped up in a story.
- Grab attention in the first 5 seconds. (e.g., for Chatbooks, a woman fully clothed in the bathtub).
- Figure out your exact target audience and speak to them.
- Pick a character or story your target audience would relate to.
3. Goop: Content (is Queen)
While it’s now common practice for brands to have blogs, not many brand-affiliated blogs are any good. Established brands struggle to create content that doesn’t feel like a stream of advertising copy. In the reverse direction, it’s hard for content sites to start hocking goods in a way that feels authentic. Goop is an example of a content site that successfully bridged the gap to move into commerce. Earlier this year Goop raised a $50M Series C at a valuation of $250M. Launched in 2008 with A-list aspirational celebrity Gwyneth Paltrow at the helm, Goop started as a newsletter where Gwyneth shared thoughts on life, recipes, general advice, and product recommendations. A cult-following formed around that content (self-named “Goopies”) and Goop was able to turn this community of readers into organic traffic shoppers.
There seems to be 3 major factors in whether content can be used to drive commerce:
- The level of fanaticism of the readership, (in this case, Gwyneth’s “Goopies”)
- Closeness of content topic and author authority to a product category (e.g., if I blog about being a VC, then try to start selling you shoes — the content topic is too far from the commerce category to be effective. In Goop’s case Gwyneth was already talking about products in her newsletter)
- Exclusive product (if the product is available on Amazon, shoppers will go there and you may as well stick to being an affiliate vs. trying to own the cart — in this case Gwyneth is selling $100+ Goop-branded glow kits and $27 kid calming mists that are not sold on Amazon).
4. Interior Define: Influencer Collaborations
Interior Define is a direct-to-consumer sofa company that makes affordable, custom sofas. They are also a beautiful example of influencer collaborations at work. Early in the company’s life, they partnered with Maxwell Ryan, the founder of Apartment Therapy, to create the Maxwell sofa.
Not only is there a brand benefit to associating with an industry celebrity, but there is also an organic traffic benefit in getting attention / driving traffic from an influencer’s followers. The Interior Define example is obviously a very deep collaboration, lighter weight examples of influencer collaborations include:
- Gifting product samples: Send influencers free product samples with the hope that they post about your product (the beauty & publishing industry has relied on this tactic for years)
- Guest blogging / reverse guest blogging: Provide content for an influencer’s blog or invite an influencer to be featured on your blog.
- Co-branded emails: You’ll often see start-ups teaming up on a giveaway or email marketing campaign, giving brand participants access to new customers.
The best influencer collaborations have social or economic benefit for all parties, and bring together brands that make sense.
If your start-up has mastered organic and/or you have another organic tactic you think should be added to the list, I’d love to hear from you.