Startup To Scale

123. Liquid To Lips - Building a Beverage Brand with Ruby Hibiscus

June 26, 2023 Foodbevy Season 1 Episode 123
123. Liquid To Lips - Building a Beverage Brand with Ruby Hibiscus
Startup To Scale
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Startup To Scale
123. Liquid To Lips - Building a Beverage Brand with Ruby Hibiscus
Jun 26, 2023 Season 1 Episode 123
Foodbevy

Building a beverage brand is one of the toughest categories in CPG. The order MOQs are high, competition is fierce, and the heavy product makes DTC challenging. So how do you succeed? I invited Noah Wunsch, founder of Ruby Sparkling Hibiscus to share how he approaches building the brand, which involves an extensive field marketing plan executing 15-30 demos across the country each week. These in person events are an integral part of the brand’s research, development, and evolution.

Listen in to learn Noah’s formula to building a great ground game and getting liquid to lips.

Startup to Scale is a podcast by Foodbevy, an online community to connect emerging food, beverage, and CPG founders to great resources and partners to grow their business. Visit us at Foodbevy.com to learn about becoming a member or an industry partner today.

Show Notes Transcript

Building a beverage brand is one of the toughest categories in CPG. The order MOQs are high, competition is fierce, and the heavy product makes DTC challenging. So how do you succeed? I invited Noah Wunsch, founder of Ruby Sparkling Hibiscus to share how he approaches building the brand, which involves an extensive field marketing plan executing 15-30 demos across the country each week. These in person events are an integral part of the brand’s research, development, and evolution.

Listen in to learn Noah’s formula to building a great ground game and getting liquid to lips.

Startup to Scale is a podcast by Foodbevy, an online community to connect emerging food, beverage, and CPG founders to great resources and partners to grow their business. Visit us at Foodbevy.com to learn about becoming a member or an industry partner today.

Noah Wunsch

Jordan Buckner: [00:00:00] For anyone building a brand right now, there are a lot of headwinds and tailwinds kind of around you, depending on where you are in the market, and one of the most challenging places to be in, say, opinion is building a beverage brand. Because a lot of you know, the products are heavy. You're shipping a lot of liquid, and so you really have to learn how to build and expand your brand on the ground in retail and get your bottles or cans to people's mouths. And so I'd love to really dive into how to build a successful beverage brand in 2023 right now, and some of , the opportunities and challenges that exist. And so for this episode, I've invited on Noah Wunsh one who is the founder of Ruby, a line of sparkling and nons, sparkling hibiscus beverages.

Noah, welcome to the podcast today. 

Noah Wunsch: Thank you man. I'm glad to be here. So I would love for you just to give a quick 30 seconds [00:01:00] overview of what Ruby is. Yeah, a hundred percent. So Ruby is a line of organic sparkling hibiscus beverages. Hibiscus is full of flavor and it's full of functionality. It's one of the most richly dense and antioxidant ingredients on the planet.

So our whole idea is can we really create a better free you beverage that delivers on the promise of better for you? So product integrity is really important for us, but that's ruby. 

Jordan Buckner: I love it. And so give some context in terms of how large the company is. About how many doors are you selling in, what types of retailers.

Noah Wunsch: Yeah, and , we're very focused on the natural channel. You know, we got that U S D A organic cert right on the front. So we love co-ops, we love Whole Foods, who's our biggest customer and has been our partner from the get go. Central market, fresh time market. I'd say we're probably in about a thousand to 1500 points of distribution across the US at this point.

But again , the focus for us is always on the natural channel. 

Jordan Buckner: You know, I think one thing that's really great is you've been able to take something like a hibiscus water or sparkling a hibiscus [00:02:00] drink and really create a much larger brand around it with Ruby. And so talk about your process on like, how do you elevate what's a relatively, you know, straightforward beverage into something that's more of a lifestyle of bringing out those benefits to everyone.

Noah Wunsch: Yeah, I mean for us it was pretty simple, which is we wanted to talk to consumers the way that we would wanna be spoken to as consumers. So it's kind of always reverse engineering that perspective if I was to envision a beverage brand that was my dream beverage brand, what would it look like?

How would it sound? How would it talk to me? And that's really always kind of the touch point. We come at the challenge, let's say. So it really started with that idea of how can we be consumer first in such a way that doesn't feel forced down people's throat, but they give kind of a social access point.

Jordan Buckner: No, I think that's awesome. I just like the iconography on the cans themselves looks really great. What have been some of the biggest challenges that you faced in building the brand?

Noah Wunsch: I mean I say this all the time, but all of it, I mean, like you kind of hit the nail on the head, which is [00:03:00] beverage is a really, really tough business.

It's extremely competitive. It's extremely challenging. It's extremely expensive. So you know, it's an exercise and getting punched in the head and making sure that you get back up again, which, you know, doesn't make it sound like fun, but you learn so much in the process that it kind of makes it worthwhile every day.

Jordan Buckner: Yeah, I definitely understand that. So like as you've been expanding and retailers like Whole Foods, right? Like I think you get this large footprint to be able to reach consumers. , what are you doing to drive trial and get people actually picking up the can?

Noah Wunsch: Yeah. For us, it's a lot of field marketing. You know, it's that idea of liquid to lips. Have someone try a product and you're one step closer to either creating a repeat purchase, , or at least a first time purchase. There's definitely a roadblock. I mean, again, you go to a beverage aisle, you look at the wall of beverage, and they're a thousand beverages in front of you.

Are you thinking to yourself that day, you know what, , I'm gonna look for something new. I'm gonna find something new. Or are you thinking, I want what I know and trust. So how are you [00:04:00] breaking that stream and cycle of going for the new and convincing someone to try you? And a lot of that comes from field marketing and demoing.

Jordan Buckner: What are some of the best field marketing activations that you've been able to do in terms of like what's been really effective? And then are there any examples of things that were maybe a dud. 

Noah Wunsch: Yeah, I mean for us, it's demoing every single day, going to all the stores that we possibly can, sharing why this product is good and why you should try it.

But you iterate on that. You know, the first time we did a demo, we showed up in a store without a tablecloth that looked like trash. We didn't have cups, we didn't know how to serve this. We're buying cups off the shelf. And then you start making it a little better. You get a tablecloth and maybe it's unbranded to start, and then you realize, let's get a branded cloth and make it a little bit better.

And you're like, is there something I can give out to the consumer? Maybe I'll make a postcard that they can take home too. So it's all about the idea of continuing to get marginally better each time. It doesn't have to be the best immediately, as long as you can get marginally better each time you do it.

Jordan Buckner: Are you still doing the demos [00:05:00] yourself, you and the team, or have you worked with a third party to be able to really scale those out? 

Noah Wunsch: So we do it all ourselves. We do hire independent BA's that we BA's being brand ambassadors that we interview. And we usually have them do a demo with us before we're bringing them on board.

But , we really have been committed to the idea of us doing this ourselves. 

Jordan Buckner: You know, I've done probably a hundred demos myself with my brand TeaSquares that I used to run. And so I know like firsthand just the experience of like being in the store and being people and like, personally I love it.

But as you know, it is like hard to scale As other needs for the business come up. And so what are the things that you're doing to make sure that your ambassadors are setting the right message and story to consumers? , and , are you tracking the results or how do you kind of build that excitement for the brand?

Noah Wunsch: Yeah. I mean, we're tracking the data, certainly. I mean, like whenever the demo happens, the brand ambassador is supposed to report the numbers of units that were sold. Usually we do it in account that reports their data on a weekly basis. So we're able to cross reference, you know, numbers sold versus how many we [00:06:00] sold at that store on a weekly basis.

But that's also the import of making sure that a brand ambassador does at least one demo with an internal team member so that they can learn from how we are educating on the product and so that we can see them in action and see how comfortable they are with the messaging too. 

Jordan Buckner: I love that. So I know demos are big.

Are there any other field marketing tools , that you've used? I know like rebate programs have been really big recently. A lot of brands are doing like a more, like a ton of quarterly promotions or doing some deep discounts. Anything else that you've tried? 

Noah Wunsch: Oh yeah, all of that. Like, everything, you just need to throw it all at the wall, man.

I mean, like, we use aisle. I love Tiffin. Tiffin has created something really great with aisle we do promos and tprs, total price reductions. We do EDLPs in certain markets, everyday low prices. Merchandising, we get half end caps, full end caps, shelves. I mean, like, It is everything. Like you can't just try one thing, you gotta do it all.

It's too competitive. So it really is just like, you keep running man. You just keep running. 

Jordan Buckner: Are you at a point too, cause like I know when I was doing this, like I don't, like, I was trying to [00:07:00] do my best to track like what's working, what's not. Like are you trying to be like as data. Central As or for as possible.

And thinking like, okay, let's see what's driving the measurable roi? Or are you just like, we just need to get ourselves in front of people and we'll kind of worry about the exact, you know, return later. 

Noah Wunsch: It's gotta be both. It's gotta be both. So for us, like we have an amazing intern working for us this summer.

This kid, Jack Savage and that's actually his name. And he's a data scientist and like he's building computer vision models for us, where like our merchandising team puts up the photos on Repli and we've built an algorithm that'll essentially count the facings in cold and dry. So we'll be able to comp store by store.

Okay. This store has three facings pers skew in cold, and we can see that it's performing 50% better than the other stores in that region. So , a lot of it comes down to merchandising. Like it really can be that simple. But you know, like top shelf is not gonna be great. How do you get eye level? And seeing the [00:08:00] associated data being so clear to merchandising is comforting and terrifying and tells you what you need to work on.

Jordan Buckner: No, I love that. You know, one of the biggest challenges I see every founder going through is making that jump. I'd say like above. 400, 500 doors when you just can't possibly know like, what's going on in person at every store. Yep. And so is that how you've been able to kind of manage or at least get a, hold on at least like the trends that are happening where you can't know every single store necessarily, but like the trends that are happening and the problems and the successes.

Noah Wunsch: Yeah. Look, you said it perfectly, like you reach a point where you're not gonna be able to know how every single door is performing. You should ideally put up. Practices and things for the team to do. Like yesterday, we do this thing called the Super Bowl Sales Day, where our entire team will hop on a Google Hangout, we'll all mute each other or mute ourselves.

And on the phone we'll just hit the line. We'll call stores in whatever region. We have a DC open with Unify Kehe, we'll offer them discounts on case deals. But we don't [00:09:00] always have insight into whether we're in the store or not already. So, like, you know, I called one yesterday and they were like, you're in here, you're in this store already and you're not selling well.

Like you're not selling at all. And I'm just like, okay, not a lady. And you know, it doesn't, it, , you can hear a million stores tell you that you're selling super well. If one store tells you that you're not selling well, it's just like, oh God, your heart gets ripped out. 

Jordan Buckner: Yes. I'm curious about like, what did you do on that call?

Like , how did you respond? 

Noah Wunsch: I just thanked them. , I thanked them , for giving us a try period. Like , to your point, we're not gonna sell in every store, man. Like, , you gotta get comfortable with that. In that instance, I think we said, you know, do you allow for promos? We'd love to do a TPR with you.

Or something and they're like, we really don't do promos. And I was like, out of curiosity, are we on cold shelf? Are we on dry shelf? They were like, you're on dry shelf. And I was like, can we get on cold? Cuz like, you know, we're a cold beverage so being on dry shelf, we're not gonna move as much and we'd love that chance.

And they were like, we'll, think about it. And you know, at that point you just say thank you cuz it is true. Like they gave you a shot, man. Like you're not gonna sell [00:10:00] everywhere. And you gotta get comfortable with that. And you don't want to annoy people so, you know. Wait for the day when you got brand penetration.

Everyone wants to have you in store. It's gonna take time. 

Jordan Buckner: Yeah, it completely is. And you know, it's interesting because, I found that those in-store, like relationships are what make or break brands, but it's so challenging, right? You're selling a thousand plus doors to build those and maintain them when they're all leaving their positions.

But in that case, I was almost like, ah, maybe next time you guys like offer the buy him, like, you know, buy them their team like a hundred dollars lunch or something, you know, just be like, Hey, we just wanna thank you, you know, you're working hard and maybe it'll just happen to end up on the cold shelf, but, 

Noah Wunsch: Oh, look, again, the outside of the box opportunities, this swag to them.

Send little neck hangers, a hundred percent. There's ways to obviously ingratiate and it's about whether it's the right door to do that in or not. 

Jordan Buckner: You know, I think it's just , a huge tell that like you're actually calling with your team doors that you're selling in just to start building , those little relationships at a time because.

[00:11:00] 90% of the brands, at least at this you know, mid-size to smaller scale, just aren't doing that. They're so focused, like behind the computer screen or maybe selling at the top of the organization, that they're not really thinking about the store level. And I think as you've hit on too, like that ground game and knowing what's going on at the store makes a huge difference.

Noah Wunsch: Yeah. No, look, again, like there's only so much you can do at a computer. There is like there are a list of maybe 50 accounts that are life-changing for most brands, period. And like they review, maybe they have an open review period, so like, you know, you'll keep hitting on that door, but most of 'em usually have a review process that's like once or twice a year.

So, you know, you break that down. What are you able to do in front of your computer on a daily basis? Every single day. Yeah. We played that game in the beginning and pretty quickly realized like that this work is out on the streets. Like you have to get out there. And it's hard I get the inclination to stay behind the computer.

It's really hard getting out there. But , that's where the change can kind of take place. 

Jordan Buckner: So one thing I wanna ask you about too, I'm curious about being based in New York. The New York [00:12:00] City market is definitely like different from a lot of other places. There's a lot of smaller independent stores like, it's almost like DSD on steroids, just in terms of people going up down the street selling.

What's been your experience getting Ruby kind of on shelf within the New York City market and what are some of the lessons that you've learned? 

Noah Wunsch: Yeah it's all hard, Jordan. Oh God, I hate this. Sometimes it can be like a lot of whining and whinging, man. , so I'm hard. You know, I think the biggest misconception is that like you're gonna launch your business and you're gonna find a distributor immediately, and they're gonna be so grateful and glad that you showed up your beverage brand out of nowhere.

I think if you're coming into the business thinking that like , you're gonna get humbled really quickly. For me, I was fortunate that I had a lot of founders kind of tell me what was what before we started the business. And they were like, your job is to work for the distributor. The distributor doesn't work for you.

You job is to work for the distributor and you need to make the case that you deserve their time. And I stand by that like the. You are not putting food on your distributor's plates until you are. And when [00:13:00] you are great, like at that point, the relationship relationship shifts, which is cool. But until that happens, be grateful to your distributor.

Ask them how you can help them. Get out there in the team. Do remes with them, help stock shelves. Do whatever you have to do to help your distributor. Period. That's like, the most important thing for us. Like we really appreciate what they do for us and we try to let them know that we're here to support them.

Jordan Buckner: That's awesome. How often are you doing kind of like ride alongs with distributors these days? Or like , your internal team doing that? 

Noah Wunsch: Whenever they let us a hundred percent. But usually, for each distributor, depending on the region, I would say probably monthly. That's awesome.

Right in between different team members, it depends. But yeah, I would say monthly feels about right. 

Jordan Buckner: I'm curious to know kind of as you're growing, you're expanding with the natural channel. Where do you see , the next opportunity? Is it just continue getting deeper inside of natural, are you looking at conventional at some point? Are you expanding within food service? Kind of what are you looking at next? 

Noah Wunsch: All of the [00:14:00] above. You know, I think conventional will be an opportunity. We really start testing out next year. That's we'll have been in business for three years in March of 2024, and that feels like the right time to start playing around with conventional a little bit.

We're playing around with food service right now, so it's, you know, Leave no rock unturned like corporate's an opportunity. Collaborations are an opportunity. Everything is an opportunity if you kind of turn it the right way. So we we're focused on all of it, which is a lot. But you know, I, you gotta take every shot 

Jordan Buckner: being a beverage brand, especially.

How are you thinking about digital marketing for Ruby in terms of both the. Awareness, building and advertising side of it, organic side, and also e-commerce. 

Noah Wunsch: I think we'll probably do more with digital marketing in the next year or so. The only place we really do digital marketing right now is on Amazon.

Like my whole principle is just fish where the fish are. If you're capturing people on Amazon, you've got a credit card out. So like people are ready to buy things. Whereas if you're, advertising on Instagram , there's a lot of eyeballs. It's really powerful. There's no question about that, [00:15:00] but there's a 50 50 chance that people actually are on there to buy something.

Most of the time they just wanna look at content. So I'm just trying to think like, where is the most valid place to hit people with marketing so that I can capture them with their wallet out and convert them. 

Jordan Buckner: Are you doing anything that's more like high level top of funnel awareness or are you really just going closer to, like you mentioned, like Amazon , and these decision points?

Noah Wunsch: I think it's really Amazon, man. I mean, look, we do like brand marketing is different. We do a ton of brand marketing, which is, you know, our events, our emails our website and like some of the collaborations that we do there. But when it comes to like straight up CPA and all that stuff, like it's really Amazon, it's fresh, direct, like Thrive Market, like these amazing platforms where again, you have people who are naturally minded, let's say Who want to buy.

Jordan Buckner: Yeah. , I think that's key and I'm glad that you're doing so listen to a podcast with Allison from Haven's Kitchen, and she mentioned kind of this, there's talking about this difference between [00:16:00] building a brand and building a business and yeah, that a lot of new founders especially are more so focused on building a brand and like sharing like really cool images and talking about their story, but kind of in like a paint way and not really focus on like building the fundamentals and getting.

Customers actually purchasing their products and. The first and second and third time. And so I think it's awesome a lot of times by necessity too, but like really focused on like how can you reach customers when they wanna buy? How can you like find them on places like Amazon? I'm very pro Amazon myself.

 I don't know if it's still true, but a number of years ago, I. Water was actually the top selling grocery category on Amazon. Yeah. Which like, seems kinda weird that like beverage actually is fairly big. Whereas like water, coffee and some other things was like, people don't wanna lug around like giant cases of a water and so then stuff everywhere.

So a lot of people actually do like buying those things online, so I think that's awesome. In looking for the next [00:17:00] couple months, what do you think are gonna be the biggest challenges that yourself or other CPG brands are gonna face? 

Noah Wunsch: I mean, look, everyone's talking about the fundraising environment right now, and understandably so.

I think there's a duality to that, which is, you know, it is hard getting funding right now. It was easier in the past, no question. And that created low barriers to entry so that the space continued to get more and more competitive because it's getting more difficult for there to get funding.

It means that it's becoming slightly less competitive, which means that if you can survive through this period, pardon me there's real opportunity on the other side of that. But surviving is difficult. I say that as someone who like, you know, We're fundraising. Like everyone's always fundraising right now.

And it's not easy, but there's opportunity in that as well. So that's one of the challenges. But the other challenge is the competitive nature, and I don't know if that's gonna correct itself or not I talked to an amazing guy who's been in C P G forever, and he was sharing with me, it was like, you know, in the early two thousands if you created a business that did 30 million in [00:18:00] revenue annually, you had eight people trying to acquire you.

Now if you're doing 150 million in revenue annually, you might have one person who's interested and like maybe they'll come in and throw their hat in the ring and like, think about that. That's crazy, man. That's five x of what used to be the norm and that would start a bidding war. And now it's kind of like we'll dip our toe in and see if maybe we'll make a strategic investment.

Like that tells you how competitive this business has gotten. 

Jordan Buckner: It definitely has, and I think. On the other side too is we've seen a lot of those larger companies have not been able to execute on a lot of their strategic acquisitions as well. And so that's slowing a bunch of those up as well. But I am excited to see, as you mentioned, like the companies who have built great fundamentals and have a great business and have a great product are gonna be the ones to succeed.

And that's just, you know, business building. But I think , it's really. Really great in my opinion at least to see a lot of people getting back to that and like, how do I actually build a business that could be a high growth [00:19:00] business, but something that's designed to be around versus something that's purely designed to be acquired.

And I think that that's where there's some real excitement around. 

Noah Wunsch: A hundred percent. 

Jordan Buckner: Noah. Thanks so much for being on the show today and for sharing more about your journey and your experience. 

Noah Wunsch: Thank you man. I appreciate it and thank you for everything you're doing in the space, dude. 

Jordan Buckner: Appreciate that.