The Next Billion Dollar Industry No One is Talking About...

The Next Billion Dollar Industry No One is Talking About... Speaker 1: Once we went viral, we sold a million dollars of that product. We went from, this is a cool idea and pet project to, holy cow, this is a real business and we need to capitalize and move on this. The great thing about viral is that for zero dollars, you're driving revenue and awareness to your brand, but it's sparing, right? So it could be one day you have two viral videos, the next month you have zero, right? So then we really took a hard look at paid media and said, how can we have a strategy where nowadays is always on? And where people are always seeing us. Speaker 2: Welcome back to another episode of Chew On This. Today we have Justin who's founder CEO of Nowadays, which is a brand you've probably spotted around your grocery store or maybe you've seen online, but they're going up against the grain. In a category that isn't easy to scale in. So first of all, Justin, thank you so much for coming out all the way from the West Coast. For the few viewers who maybe don't know about your brand, don't know about you, give them a little bit of history. You're also a serial entrepreneur, so maybe give us a little bit of that background, and then we can jump into what you've been building with Nowadays the last couple of years. Speaker 1: Perfect, thanks for having me, guys. I really appreciate it. This setup is like first class. Speaker 2: Thank you. Speaker 1: It's been awesome for you guys to have me out. Yeah, my name's Justin Tidwell, co-founder, CEO of Nowadays. We're the first ever nationally available THC infused spirits. So basically the easiest way to think about it is you take a tequila bottle, a vodka bottle, take the alcohol out, you put THC in. It gives consumers a nice buzz but you don't have all the negative after effects from a hangover to a tough night's sleep. We launched the product in March of 2023. Super limited funding, just went to market, wanted to see what people thought of the product and had the benefit of going viral on TikTok. In our first 90 days, we did a million dollars in revenue, so it was kind of like This is a fun pet project. Wow, this is real, really quick. Speaker 2: Wow, that's really cool. Speaker 3: 90 days, first million. Crazy. Speaker 2: Well, we've got our headline for the podcast. You obviously started this, what seems like maybe it was a passion. Whatnot. Did you know going into it how challenging it would be given the fact that you can't just set up an ad account and start running ads tomorrow? That first 90 days looks like you had a little bit of things hitting the right way, but had they not and even just certain months where it's not hitting certain way, what are you kind of looking at and saying, hey, like, how do I go about marketing this? Speaker 1: So I think the saying ignorance is bliss is probably true, especially when you're starting a business, because if we knew every single hurdle we'd have every single month over month, if we knew that all this started, it would have probably freaked us out and we would have never started, right? So for us, it was really about diving in headfirst and believing in the product. My co-founder and I, we were at that phase that I think a lot of people hit, which is basically We've been drinking through college, late nights, partying, and we were like, we just can't keep doing this. Like, we have jobs, we have responsibilities, and we pretty much were out there ourselves looking for an alternative product. Didn't see anything that checked the boxes of like, we could still have a good time, but without all the negative aftereffects. So that pretty much started him and I just going like, What if we could put cannabis into a drink and it just started with that overall idea and at that time it was like just about product development and nailing the product. It took us about 18 months to actually develop nowadays, because if you can imagine, if you've ever had cannabis before, smoked it or vaped it, whatever it may be, putting that weedy flavor into a drink, you can imagine it's not an easy thing to do. So that took us a good amount of time. And then once we nailed the product, we really launched from there. And our focus was appealing to consumers On platforms in the ways that we're able to. So we can't go on Instagram, we can't go on TikTok and say, try this cannabis drink. It's THC infused, right? But what we can say is, are you looking for an alternative? Are you looking for something that gives you a buzz without the negative after effects? And we focus on the consumer benefits rather than the actual like functional ingredients in the product. And that's kind of, from the start, we kind of stumbled into that accidentally. And it's really been the pillar of our marketing ever since then. It's helped us scale a lot on each of these platforms for sure. Speaker 3: Wow, that's huge. So it sounded like it kind of started first with like maybe an organic viral moment. Can you walk us through what that maybe piece of content maybe was? How did you guys kind of capture that demand and what did you guys do with it post kind of that viral moment? Speaker 1: 100%. So first thing was is like we looked at our target demo and in our opinion, We felt that like any new cool product, it was always the girls that brought it to the party. If it was a new drink, if it was a new food, whatever it may be. So we kind of said like we want our brand to lean like 60-40 female-male and that was to kind of drive the female consumer to the product. So with that in our TikTok marketing, our Instagram marketing, it's more female-led. And that first viral video, It's kind of the old saying like short and sweet, right? So a girl was holding a like a cocktail glass and basically just said like drinking without a hangover and like a nice viral tune on it and we checked it literally within 30 minutes it was already at 100k views and it just started to run. And I think the tip about that is like having viral content needs to be very quick to the consumer and intrigue their interest. And then from there, you can drive them to your site, your landing pages and use that time to educate them. But you really need to grab them in that moment. So that was kind of like out of the gate what our focus was. And since then, like it's been a major focus of our marketing is like intriguing their interests. Showing them it's different and then driving them to education at that point. Speaker 3: So tactically, when that video started to pop off, were you guys just directing people like, oh, there's a link in bio, like go shop now. How did you just start getting orders? Speaker 1: Yeah, so we did our first production run, we made a thousand bottles, which in our world equates to about $80,000 in sales. We had a million dollars in demand, 80 grand in product. That's worse than having no demand at all, to be honest, because you're looking at that going, wait, people want it, but we can't give it to them. So we literally overnight had to pivot to a pre-order model. So when that demand started coming in, we were like, we don't have the product, like we're going to have to shut this thing down and like not take orders. My co-founder is like, let's just see if people are willing to wait like 90 days for their product. So we changed on our site pre-order, notified the customers quickly. And the thing that we saw and we realized was that like, number one, people were willing to wait and they kind of understood our early story. Like we literally sent an email that was like, Hey, we're a brand new business. We've been around a month. We'd love to send this to you, but we just can't. Like, are you willing to support us and wait? And the cool thing was, I think consumers respect that transparency. So from there, Basically, we held on to all those pre-orders and we got with our manufacturing partner and said like, hey, we know we said we're probably going to go from 1,000 bottles this year to 2,000 next year to the three, but we need you to produce 50,000 like now. And that guy, honestly, like hats off to him. And I think it shows the early founders, like if you sell people on your vision, you can get people behind you because that person was a large vodka producer. And we went to them with this crazy idea of like, just make this THC drink and let us know, like, like just go on this ride with us. Let's see if it's something interesting. And now he's turned off all his production lines for vodka. He's only producing our product. And really been able to lean on that manufacturer, but I think we communicated with our customers and they're still around today. And I think that's the key is like, you're not going to be perfect as a business, but communicate to your customers, they're real people and they'll get it, you know. Speaker 2: Walk me through kind of even just like the product creation, right? I know you guys have the cans now, too. And correct me if I'm wrong, the cans are newer. Speaker 1: Yeah, that's launched in the last six months. Speaker 2: Yes. And so the bottle, right, and I actually have a striking memory of this because it was very recent. We had a poker night at my house and I was doing Dry January. And I brought out that bottle because I was like, all right, this is what I'm going to have while everyone else is drinking. You know, first of all, I think the looks I got was like, wait, what is this? This looks kind of like the same experience of a Cosamigos bottle, right? Or like the tequila bottles you're used to or a vodka bottle. And I think that part is really cool because like you're now like shifting people very little from what they probably want to be closest to, which is that experience they're used to. So I'm curious, like, was that intentional? And have you guys had to like modify that? Did you guys work on that? I'm just curious on like how that product development and that design and branding kind of worked. Speaker 1: So going back to when we launched on social media, we knew that we had to appeal the subtle nuances to consumers. We also knew that the cannabis industry to date has done a really, really good job of selling products to people who want cannabis products. So, you know, a hundred milligram edible, you know, a super high chocolate bar, whatever it may be. But for people like myself, I had actually and still haven't ever smoked a joint, haven't ever taken an edible other than drink cannabis drinks at this point. So we created a product that felt like we could bring it to our grandparents' house and say, hey, try this drink and they would accept it and bring it in. So like number one was like, it needs to feel like a mass market product you'd see at Whole Foods, you'd see, you know, at a Target, because that's how we're going to tap into the 80% of the market that's never used a cannabis product before. And then second was, now that it looks familiar, we kind of need it to look a little unfamiliar to intrigue your interest, right? So like, I think that's like, I love hearing that because our mindset behind the bottle was, let's have someone bring this to a party. They feel like it fits in on the bar cart, but they look over and they go, Hey, what's that one over there? Like, why does that look a little different? Right? So like we're trying at nowadays to be in the mainstream, but stand out a little bit. And like that kind of goes into our marketing or product development. So, For us it was nailing the flavor. And then from there we said, okay, we have a delicious product, like people are going to reorder it because you could have the best marketing in the world, but if your product's not good, you're going to get that first sale and be done. And then second from there, it was about designing a packaging that stood out. And we really looked at like every single liquor bottle you can imagine. The amount of Total Wine, Stu Leonard's that I've walked down, examined, taken a picture of every single bottle. It's like actually a sickness at this point how much I've done it. And we really took the time to see like how can we stand out on the shelf. And that's what got us to our end product, which is that kind of beautiful frosted bottle that definitely stands out on the shelf. Speaker 2: Very cool. Speaker 3: Love that. Okay, so went viral. Product is now placed. Orders are shipping out. Take us through the next few steps of how you now kind of start to get into maybe some of the paid channels or other channels. What ended up being like the distribution to getting in front of more customers? Speaker 1: Yeah, so once we went viral, we sold, you know, a million dollars of that product. We went from this is a cool idea and pet project to Holy cow, this is a real business and we need to capitalize and move on this. So from there, we kind of had two mindsets. Number one was like, it can't just be Anthony and I in a laptop answering customer service emails, calling the co-packers, you know, moving, like trying to get everything done ourselves. So from there, it was like bringing in a few core employees, like help us get some stability. And then from two, the second piece of that was getting more of an evergreen strategy, right? Because the great thing about viral is that for $0, you're driving revenue and awareness to your brand. But it's sparing, right? So it could be one day you have two viral videos, the next month you have zero, right? So then we really took a hard look at paid media and said, how can we have a strategy where nowadays is always on and where people are always seeing us? And we were able to utilize the strategy of really not speaking directly about our products but letting consumers know Here's the product benefits you're going to get and driving them to our site and then diversifying platforms that if you're having an issue with one you can drive more to the other and kind of have a full circle approach. So once we had an evergreen strategy when it came to direct-to-consumer and we had viral videos that would drive a ton of awareness, Our second shift was, okay, we have data that people want these products because Direct-to-Consumer has proven that people want to buy them. We're able to then go to alcohol distributors and basically say, hey, we have data to support consumers want these products. The first couple, when it was early on, we were definitely laughed out of the room. Like, well, you're telling me you want my 100-person sales team to sell weed bottles in a liquor store? Like, get out of my office. So it was definitely a little bit of trial and error in appealing to our target market. But once we had a few distributors that believed in us, We proved the concept that consumers will buy these in liquor stores and in traditional outlets where other products are. That's when our business started to really take off because we were available in stores, we were available online. We're always at front of mind for consumers. Unknown Speaker: It's incredible. Speaker 3: So with the strategy of being kind of omnipresent, right, so DTC, retailers, where do you see the shift going to? Do you guys want to be primarily in retail and maybe use DTC to kind of fuel that fire or maybe like a break-even and just try to drive awareness there or The other route, which is maybe a subscription model for online, because I know with beverage, it's tough, right? Shipping costs are high. Margins aren't amazing for DTC, but what's the end goal for you guys? Speaker 1: So the beautiful thing about our direct-to-consumer business and why I always push Founders to try to go the organic route as hard as it can be is that it's allowed us to build a profitable base for our business. So we had a 500,000 person email list who subscribed from those viral TikTok videos. So we built a massive base of people that basically wanted to come to our site for free. That gave us the ability to utilize those profits that we got for free and then use it to scale the brand. So our DTC business is still first-time profitable even with customer acquisition when it comes to paid. We've been able to use that as a base. But what we see in the beverage category is that people are still buying beverages in person. It's the weirdest thing like I'm sure you guys see with supplements like people will buy online but for some reason for beverages like your main driver of revenue is in-person experiences. So we feel that DTC is like a short-term way to scale very fast and that wholesale is a long-term investment. So what we've done is we've Essentially made a huge bet with our profits from direct-to-consumer to go build a distribution and wholesale business. So we're basically using profits today to build what we see as the future of the category. Wholesale, as I'm sure you guys know, is extremely, extremely expensive. You need sales reps, you have returns, you have, you know, rebates, the whole nine. So it's more of a long-term play. So we have a sustainable approach to DTC with an investment approach when it comes to wholesale. And eventually, I would estimate that it's going to come closer to 50-50 in the category when it comes to DTC and retail channels. Speaker 2: Let's break down paid a little bit more. Can you maybe talk a little bit about the channels you're on? I don't know if you're testing things like Applovin or if it's just Meta or if it's Snapchat, some of the actual channel strategies that you're doing and if there's any cool tidbits that you have that's working really well across those channels. Speaker 1: Yeah, so funny enough, I was very new to paid digital marketing. I came from the B2B world before this and so this is a brand new learning curve for me as far as content and how to put it out there and what works and what doesn't. For us, Meta is still our top platform. It's probably got about 70% of our spend. I think consumers on Meta, in my opinion, if you have what I would consider a social product, And that is the way to go because consumers are kind of in that mindset when they're on the platform. So for meta, what I've learned is that content is king. So you have to have your content library like refresh, refresh, new, new, new. There's a lot of fatigue that could take place. Speaker 2: Are you doing all that in-house or are you guys... Speaker 1: We're utilizing an outsource agency for that. What we've realized is that like we can only handle so much bandwidth internally. What we can do is pump out content. So we always have shoots, we have videos, but then sending it to an agency to cut it up and kind of keep it fresh out there. I do think that AppLovin is going to be a major platform if it kind of sustains this rocket ship growth that it's on. We were recently approved to go onto the platform and the nice thing is there's far less restrictions for THC products on AppLovin. And for us, we're super focused on being kind of at the forefront of compliance as well too. So when customers find us, whether it's on Meta, AppLovin, They're not able to purchase from our site without being ID'd too. So that's kind of a big part of marketing on these platforms is like we want to take a very kind of compliant approach and make sure that people we're working with are all 25 plus and we're able to kind of ID on each purchase because we are growing quickly and we're making a new category out of nothing. So it's like we need to be super compliant and super ahead of the game and self-regulate because we know that eventually those regulations are going to be in place. Speaker 3: Makes sense. So you're facing a lot of hurdles, right? There's regulatory, there's compliance with some of these paid channels, and then on top of that, you are one of the first to have to educate the consumer that something like this exists, right? How do you guys strike that balance between not being able to fully say what you are, but having to also educate the consumer on what it is you're actually selling? Speaker 1: 100%, yeah. So I think it comes in A couple different phases. So first one is that our product is extremely, extremely low dose and safe for consumers. That's intentional because we knew that we're selling something to somebody that probably has never tried cannabis before. And we've all heard those stories of our friends that are like, I took an edible and it was the worst experience of my life, right? Speaker 3: That would be me. Speaker 1: Exactly. So we wanted to be the company that avoided that situation. So number one, like, The products we have are extremely, extremely safe, extremely tested, extremely low dose. So you could chug our, you know, microdose bottle entirely and like you might, you know, sleep like a rock, but you're not gonna, you know, have any issues past that. So number one was like making sure the product experience was really good no matter how much education they read from us. Then number two is like in a normal business, You want to show them the product. You want to sell them the product, right? For our team, I tell them our job is show them the product, drive interest, educate them. What is the product? How do you use it? And then sell them because we want the consumer to know exactly what we're doing and what we're selling. And that comes into really first is that interest. You drive them to that site or that landing page. From there, it's education. So most websites are like, we need to have, you know, our conversion rate optimization. I'm like, we need to teach them exactly what this is and what it does for them. And then we want to drive them to purchase. And then post-purchase, while that product's on the way, we're going to be sending you emails and information about how to use the products before it actually lands. And honestly, to date, you know, we have not had any bad consumer experiences. Like all the emails we get are like, this changed my life. Thank you. I had a great experience. And then they try that microdose and then they tend to level up and kind of get a little more brave and try a little bit of the stronger products. Speaker 3: I love that. So is there, are there like certain things that obviously you can't say? Like, oh, this is a cannabis infused spirit, which will give you the feeling of being high. What is the alternative? Like, how are you guys kind of getting around that? And like, what exactly are you saying instead of? Speaker 1: So like a good like example would be the exact one you just use. Try this cannabis infused spirit that will get you high. We'll all sit in a room and say, how else do we say that that is a better way to attribute to consumers that we're not going to have any issues with our marketing or product. So we would sub in, try this plant magic that will give you a lift. Right. So it's like, you know what I'm saying, but I don't have to go and directly say what I'm saying. Right. So like in a lot of our marketing, we go that route. And consumers are smart. They're on social all day. They're seeing the gardening trends. People on social basically come up with a community of how to talk about the products they want essentially. So it's about appealing to that consumer. How are they talking about it? And that's how we're going to talk about it. It's kind of the easiest way. Speaker 3: Love that. Speaker 2: Chew on This is sponsored by... If you want to build a profitable e-com brand these days, then you need retention. Lifetime value is the lifeblood of your brand, especially when cacks keep going up. Being first purchase profitable is great, but you only really start to print money when that customer comes back over and over and over again. It's why subscriptions are such a big piece of our strategy here at Opti. There's a big reason brands, no matter the size, are using a tool like Recharge. What we like is that they're not just adding a subscribe button on your site, they're a complete subscription engine, helping you convert buyers to subscribers, preventing cancellations, winning back churn customers, and they're even driving more revenue through smart upsells. That's why big brands such as Dr. Squash and even Vital Proteins are using Recharge. So if you're looking for a powerful, all-in-one subscription platform, head over to Get Recharged today to see how you can pump up your LTV for your brand. Now, let's get back to the episode. So I'm curious on the attribution game, right? You're obviously started online. You've grown the B2B and retail piece heavily and going into this, you're going to be a bigger sector of it. How do you think of attribution? How do you think of, you know, the efforts that are going into different places? Do you worry a lot about that? Do you like, hey, what's my dollar going to turn into here versus over here? Because I think for DTC brands, right, I think attribution becomes a huge thing. Even going from one platform to another, it's like some people won't even do it because they're too nervous about being able to understand How the return will be how do you think about it given that you're also in like this alternative category where almost There isn't too much noise either. Yeah, you know you get to kind of see what's coming about. Speaker 1: So I think number one for us, and I always recommend this, is we have a long-term outlook on our business. We grew super fast. We went from zero to 100 really quick. But we have to look at things and say we have to try a lot of things. We have to fail at a lot of things. If we have a month where we're upside down on our paid media, we need to prepare for that as a business because we have a new product in a new sector that things are changing every single day. So for us, it's number one, we have that mindset of We might fail at a few things to learn how we're going to get it right. And then second is once we get it right, we double down until it's not working anymore. So that's kind of been our strategy since day one. And like we've had things where like our ad account was shut down or this video was taken down or whatever it may be. We just have to understand that we're in a new business in a new segment. We need to pivot. And then I think secondarily is having a diversified strategy where you're not overly relying on one channel or platform. And that's where I think people can go wrong is like, but our return is, you know, twice as much on meta as it is on TikTok. It's like, but if that stops, what are you going to do next? Right. Versus if you had a decent return on TikTok and you ran that up and you still focused on your great return on meta. You're going to have a backup plan in case things change. So I think it's like be okay to pivot, have your business set up sustainably so that you could take a step back one month and you're okay. You're not, you know, hand to mouth, so to speak. And that for us has been super successful so far. Speaker 3: We were talking about this right before the podcast, but influencers. Curious, you know, obviously you understand the importance of having like this organic presence and something that can drive revenue and brand awareness so that Obviously, you know, DTC picks up. It has that halo effect on retail. How are you guys looking at influencers? Is it, you know, something where you're kind of building an army or are you working with specific people? But walk us through what your strategy is there. Speaker 1: So my approach to influencers has been one of like a lot of education and learning. So we first kind of focus on like, okay, if we pay this person X amount, what are they going to post and what does it look like? In my opinion, it came across very inauthentic and consumers pick up on that. Like we'd have a video with a hundred thousand views where the influencer was like, buy this drink. It's delicious. And it wouldn't convert to sales. So I think Consumers know what they're being sold and they know what they're being like actually reviewed and told. So we switch our strategy completely to sampling. We send over like a thousand samples a month to influencers and going back to... Speaker 2: Those little bottles? Speaker 1: Yeah, the little shots, the bottles, whatever. Basically whatever an influencers want like we'll send and it goes back to like having faith in your product, having something that stands out because we're such a, we're first to market and we're very unique. Influencers are posting our products like 70% of the time we send them. So we're getting a ton of free kind of exposure that way. And what we've realized is that the video of, Hey, buy this bottle. It tastes good. They paid me to say it. Versus I'm going to try this new drink and whether it's a positive review or they're giving us feedback, those generate way more sales just because I think consumers know like, okay, this is the influencer's real experience with it. So I think for us like seeding has really led the charge and you can also create like an evergreen strategy with seeding because if you're seeding enough, You have enough backlog of people that have got that product they're going to be posting consistently and that helps you keep your socials like on trend and your stories always have something going. So that's been a major focus for us and honestly has been a huge way for us again to go back to building an email list and a customer base profitably and then using that to scale. Speaker 3: Got it. So the strategy here is get it into the hands of many people possible. The brief is the most important part, right? Because it's as soon as you send out the product, it's basically asking them, you know, what exactly that They should post, right? But how do you guys strike that balance between just getting into somebody's hand without any expectation and then hoping that they post or like, what is that part? Because I feel like that's the part that a lot of people struggle with. It's like, oh, I'm doing all this seeding and nobody's posting. What do I do? Speaker 1: So two parts to that. So specifically to our products, Go back to educate, right? So it's like, hey, we're sending you this bottle. We don't want you to have a bad experience. Here's how we suggest you try it, how you use it. We have a much more hands-off approach, and I would say much riskier than most brands. We believe that creators know what they do better than we know what they do. We send them the product, we educate them, tell them how to use it, and we say, speak your mind. And that's putting ourselves on the line because if somebody didn't like it, they could blow us up too, right? So for us like we've noticed with Particularly working with creators, they don't wanna be micromanaged just like any of us do in our business. So it's telling them about the product, showing them why it's unique and different, and then seeing if they post it. I think if you're in a more saturated category, let's say you're trying to sell a vitamin or whatever it may be, I think when you're seeding influencers, you really need to be specific about what's unique about your product, what's different. Hammer that home before they're getting it because that's gonna come to mind when they're posting and talking about it. And also, Creators want to entertain their audience. That's what they're there for. They're going to post about products that entertain their audience. So if you look at your products and say, I need to craft these for the digital age, which is how do I entertain people? People are much more likely to post it. Speaker 3: Got it. And then finding the right people. How are you guys going about kind of making sure that you're getting the right person with the right audience? I don't know if you guys are going for like micro, macro. What does that look like? Speaker 1: For us, it's about finding people that we feel like speak to that audience. So going back to like 60-40 female to male, kind of more of the like younger demo that's focused on switching away from alcohol. So that's kind of, we check those boxes. Then second is now that we do have like an internal team, we dig a little deeper and say, okay, what's this person's engagement? Like how much actual organic activity are they getting? Okay, they check that box, then we send it. So it's really like match the target demo. For us, we tend to focus on like influencers anywhere from 2,500 followers all the way up to, you know, 100 million followers, right? So we'll go a very like wide net because a lot of the times what we've seen is That person with a hundred thousand followers may only get like a hundred comments on their posts and there are people that don't know them but the person with 2,500 may get every single one of their friends commenting on it because it's actually like their tight-knit group and those converges as well so I think it's just about like having a wide net when it comes to that. Speaker 3: Makes sense. Speaker 2: So I'm curious on obviously now going into the cans and you'll continue to product develop and whatnot. I'm curious, how do you look at kind of the next, you know, next five years, right? Because I think the evolution of the category I think is something you had a vision to, which is I think people are naturally either moving, it's not just all people are moving away from alcohol, they're moving to this, but Naturally people are wanting to be healthier, find ways to be, you know, sober conscious or sober curious, this and that. I'm curious, like, how do you continue to feed into that, right? Is it necessarily outside of THC or will it always be around that? How have you thought about like, because at the end of the day also, you're curating a customer base that now has a persona, right? Which is like, again, if it seems either super curious or moving away from alcohol or THC lovers but don't want to smoke anymore. You have all these different personas that are fitting into that. How are you going to build around that? Speaker 1: So what I tell our team, basically when we start our management meetings is, What Red Bull and Monster are to the energy category is what nowadays wants to be to the functional beverage category. And I specifically say functional beverage on purpose. I don't say THC beverage because we are setting up a platform for people ...that are interested in alternative products, right? So I think THC beverages is a great flagship product that actually has the effect you tell consumers it does. What the future holds for us, I think that's definitely an interesting question. And do we dive into other categories? Do we go deeper within the THC segment? It's definitely something we're continuing to eyeball, but we need to have ingredients that actually give consumers A real impact and a real effect. I think if you're selling something that doesn't back it up, you have the sizzle been off the steak, like it's not sustainable. So if we see something like THC that can give consumers that same effect and it delivers safely what it says it does, that's definitely an option for nowadays down the road. But right now we have so much ability to scale and we feel that we're just like scratching the tip of the surface when it comes to people interested in THC beverages. We're going to go deep and focus on that. And then from there, I think secondarily is we're selling a product that still does not have a carved out industry and regulations, right? Every single state is different. So we need to lead the charge on putting sensible regulations in place throughout the country and federally. And that's going to be a major focus on for us because we want consumers to have these products. We want them to be tested. We want them to be safe. But we're gonna have to go do that work with all the local governments to make it happen. So the next five years for us are gonna be incredibly busy and I would say there's a good amount of job security for my co-founder and I because we're gonna have a lot of work to do. Where that goes from there, I think sky's the limit for sure. Speaker 3: As the industry does grow, right, I'm sure there's going to be competitors that kind of come up and are trying to sell the same thing. Obviously, you see the alcohol industry is super competitive, right? You go to like any liquor store, if you know anybody who runs a liquor store, like the margins are so low just because everybody's, it's a race to the bottom, right? How are you guys thinking about that? Obviously, there's still time before it kind of ...becomes as competitive as alcohol but like what are you guys thinking in terms of how you can still stand out but be you know competitive? Speaker 1: So it's funny you say that we've had over the last few months like a ton of knockoff products come on the market like I'm telling you like they're trying to basically like deceive a consumer and look exactly like us so and I think that's natural For all early to market founders and especially if you've experienced some like public success that people are gonna try to come after you, right? And that's very normal. Speaker 2: Especially when you're building the category. Speaker 1: 100%. So like that, number one is like you're gonna have competition and that's a good thing and like you need to think of it of like iron sharpens iron. And as soon as we, you know, popped off, so to speak, I was already thinking about that question of what happens when it gets competitive, right? So I think for us, it's number one, it's maintaining a premium brand and a premium product. We're not going to get in the mud and fight over being, you know, if you look at the alcohol space, the cheapest tequila, right? We'll leave that to somebody else. Like that's not our interest. We look at the brands that have staying power over time, Clas Azul, Cosamigos, those type of brands. They bring something more to the consumer than just the cheapest tequila on the market. So for us, how do we do that? It's really about brand building at this point and then building the most quality supply chain product we can. Because if there's cheaper products with a lower quality, like If that's what the consumer wants, they can go for it. We have a feeling that people want a safe, effective product that has a real brand behind it. So it's about building in-person activations, partnering with large names, kind of putting gasoline on the fire, so to speak. And where we're going to differentiate long-term is going to be brand and not price. Speaker 3: The one thing you said was partnering with large names. Any cool campaigns that you guys have run or any stories you can tell around that? Speaker 1: This was actually a good example of organic seeding. So we actually sent a free bottle to a large kind of name, Bethany Frankel. I don't know if you, she's been very successful. She sent her a free bottle and the cool thing about her is she's very honest about her products on social. We sent it to her knowing, let's see how it goes. She actually had the experience that we talk about, which is she drank too much of our product, posted about it on social. I thought I was supposed to drink the whole bottle, but I just realized it's a per-shot serving. Speaker 2: And she's quirky too. Speaker 1: Yeah, exactly. She's awesome. And she ended up posting a series of five videos, got over five million views kind of together, drove a ton of sales to our website. But the last video is my favorite ever. She said, I didn't read the instructions, I drank too much, and I still had a great experience. So going back to like letting consumers be honest about your product, talk about it, and then that's a great example of like a seeding partnership that could eventually turn into something more as well too. It's cool to see big names like that entering our category talking about it, and it definitely gives us a large consumer awareness. I can't tell you how many, you know, my mom's friends that text me and said, I didn't know this was your product. Congrats, it's awesome. Wow, that's cool. Yeah, it's definitely going to be a focus for us of like leveling up when it comes to who's trying our product and talking about it. Speaker 3: Love that. Speaker 2: I think in that same breath, I'd love to maybe jump into a little bit of like, Other cool things you've tried, tested, maybe hacks you're doing online, whether it's on the creative end or on the landing page and the website end, maybe some of the, or even just different campaigns you've done that I, you know, I think some of the, sometimes when you hear ideas, it inspires so much more creativity than others. So yeah, any other cool campaigns or tricks and hacks that you've kind of been doing over the last couple of years? Speaker 1: I think for us, what we've done a really good job at is having a halo effect around the brand, having things going on organic, having things going on paid, influencers talking about us, live events happening, and just letting it always be circulating consumers. That's worked really really well for us. I think for us it's like how do we take that organic traction and have consumers see us like 24-7 all the time. It's interesting actually I saw a data point from our team the other day. A consumer needs to see you 8 to 11 times to consider purchasing you. So it's like if you really think about that like that's a lot of work to get each of us with everything on our phone going on to see us 8 to 11 times. So I think it's like creating that circle around your brand within the market you want to target. And then just letting things run at that point. And then the more product you sell, the more word of mouth you get. So it kind of like works as a wave of momentum around your brand. It's like the more you're doing, the more you're able to do. Speaker 2: I'd be really curious about, you know, when you look at the way consumption happens online versus offline, right? Offline, I mean, my behavior is probably like once a month, sometimes twice a month, I'll go to Stu Leonard's and buy a bottle and it's like, it's right when I'm about to be done and I'm like, all right, I don't want to be done, right? So I want it there. I'm three minutes away from my store, and I'm usually going there twice a month anyway, so it works out. You have the online buyer that maybe doesn't even know you're in store or whatnot. How are you guys thinking about retention, maybe subscription, maybe a little bit more into that world of just getting that repeat, given that you guys have focused on building such a good product? Speaker 1: Yeah, so going back, we launched and went from, you know, Zero to a million dollars in sales in 90 days. We were not thinking about how do we have the best subscription policy? How do we do all this? We were just like, let's keep up. Now we're at that phase of our business where I think for online businesses to sustain that subscription is like number one importance because that's money in the bank the next month, the month after that, the month after that. So I think it's kind of two strategies. It's number one is the customers for us that we know go on and randomly buy a bottle every month. We're trying to attribute to them of, hey, buy a bottle, we'll give you X, Y, Z, free hat, a free shirt, attribute to why do I want to get on that subscription and what's convenient for me. And I think there's never a lost opportunity, right? Because you have that email list, you have the customer searching for you. So I think it's attributing to them, but it's really focusing on targeting subscription. For a product like ours, we have kind of different consumers that are going and buying our product. The normal type of consumer is like, hey, I want to go to a party and I want to impress my friends and have a good time and I don't want to drink. They're buying that product and it's more one-off like we're talking about. That person's not necessarily a subscription target, but the people that we notice that are purchasing frequently, they could be using it for, in their mind, a medical use. They could be using it for sleep, whatever it may be. Those are the people particularly we want to focus on and say, you have a day-to-day need for this product. Let's get you on a subscription. I always prefer to try to go the route of like, I think it's easy to just say like, we're going to discount this and, you know, buy it more frequently. That works. And like, you should do that because if you can get somebody guaranteed to buy your product, you know, every single week or every single month, like it's worth giving away 10, 15%. But first, maybe there's another reason that that person will subscribe to your product. That's going to be a big focus for us. We're actually switching from WooCommerce to Shopify. And I think Shopify does a lot better job of being able to push subscriptions. And so when we switch to that platform, it's definitely going to become a major focus for us. Speaker 3: Outside of maybe a focus on subscription or other retention strategies to get people to come back, how about product expansion? What does that look like? What does that roadmap look like for you guys? Speaker 1: Yeah, so we launched our flagship product, which is our 750ml bottle. What we noticed was that like consumers love that product. They're buying it a lot for taking it to a party in home use, but people want like that cool, refreshing drink in the summer. So we launched cans as basically like a moat strategy of, hey, they love our bottles. They're now interested in THC beverages. Let's not give them an option to go somewhere else. Let's, let's service a demand that we know is there. So I think first is like, what does our consumer want in building products around them? versus forcing a product down their throat that they may not necessarily want. It's kind of been interesting to see because our first run of cans We actually did a million cans and sold out DTC within like two weeks. It was wild. But I think now for us, you do hit a point in your business where it's like you can't have the shiny object syndrome and you want to do this, you want to do that, and you want to be everything to everyone. We're kind of going to double down and focus on like what we have and more focus on like expansion versus trying to have a bunch of SKUs. And then having kind of a quarterly strategy of what we call LTOs, which is like a limited time offering, we see that keeping consumers engaged. So it's like, hey, this three month segment, there's a cherry flavor available for you. The next one's the holiday one. That keeps things fresh, but you're not having to always like have a SKU that's going to be there forever. Speaker 2: And then I'm very curious on, you know, you talked a little bit about activations, right? The world of activations for most DTC brands probably starts and ends at like, hey, I got into Walmart, let me do a trial or a sample at Costco. For you, I mean, it can go down to something like, You know, a concert coming up or you have South by Southwest or you have some of these huge events. I feel like it actually becomes harder to choose where to be. Give me a little bit of maybe like either something that you've learned from maybe doing the wrong activation or something great that's come out of doing the right one. Speaker 1: Yeah, so we've definitely kind of leveled up like starting with my co-founder and I walking into a liquor store and passing out bottles. To our next event coming up in May, we're sponsoring a Formula One event. We're gonna have, you know, a hundred people on the racetrack. It's very large. You have to start small, see what works, and go from there. I think if you went straight into the Formula One event, you're gonna waste a lot of money and do it the wrong way. And then I think focusing on who is your target demo, who are we trying to get to be interested in this product, post about this product, talk about this product, And then focus on the experience and not so much on like, taste this, taste this, taste this, but make it feel like the brand while you're there. And that comes down to the people passing out the product to what you're talking about it. And then the last piece is using that time with consumers. If you have somebody's attention in today's economy, that's huge, right? Using that time to educate them on what's the product, why do they want it? And where to go and purchase it, right? So like for us, we're focused on events actually driving value from those. And I think it's really going after that target demo and then using that time you have. Speaker 2: Before we jump into Chew, I'm just curious, more fun fact question, how often are you drinking nowadays? Speaker 1: Going back, I literally was like the most straight edge guy you ever met. I'd be the guy in the college dorm room and the other guy is smoking weed and I'm like, why are you doing that? What's wrong with you? So I kind of went from that guy to now like leading the charge in the THC beverage category. So it was a huge flip. But for me, I honestly, with nowadays, it's three, four days a week for me now. I rarely drink. I do still think there's a place for alcohol. And like, that's where I think like, we don't come out and say, don't drink alcohol. We just say, we have a great alternative for you when you want it. But for me, three, four days a week, I'll pop in the jacuzzi at night, pour it on a glass, and just sit there and enjoy myself. So I'm actually a fan of the product, which is pretty cool. Speaker 3: It sounded really nice. Unknown Speaker: We need a jacuzzi. Speaker 3: Love that. I mean, love your story. It's really interesting to see how you kind of took something that was a complete white space and turn it into what you have. For the listeners and viewers out there, Is there one thing that you want them to take back and implement in their business today? What would that one thing be? Speaker 1: I think, in my opinion, it's easy to get, even with stories like ours from the outside looking in, wow, they did a million dollars in 90 days, they're growing super fast, they're doing all this. Run your race. Focus on what your business needs today and go step by step. And those little steps lead to huge leaps. And that's really for us for nowadays was not, we didn't want to be a one hit wonder and do a million dollars and then disappear, right? So it's about every single day improving our business, tweaking it. And I think That's the advice I'd have to any founders. Just focus on that and it's going to show up over time. Speaker 3: That's great advice. Speaker 2: Chew on that.