January 6, 2020
In just over 4 years, Nutpods has become a leading plant-based coffee creamer on Amazon and has racked up over 6,000 reviews on the platform.
In the Nutpods early years, founder Madeline Haydon took a nontraditional approach to building her brand. While many industry experts advise an omnichannel sales and marketing strategy, Haydon took the single channel path, focusing most of her initial brand growth on Amazon.
It paid off. Here, Haydon reveals why she was laser focused on Amazon and how she did it.
In the Nutpods early days, your primary sales channel focus was Amazon. As a leading plant-based coffee creamer on the platform, why do you think this strategy worked for you?
Madeline Haydon: We launched on Amazon, in part out of necessity and in part because it made strategic sense as an emerging brand. Starting a brand in retail grocery requires a heavy amount of working capital that we didn’t want to commit to before we knew if we even had a product that resonated with consumers. With Amazon, we were able to set up overnight distribution to all 50 states and it was scalable when nutpods had only a few employees.
Given the nature of Amazon’s product reviews, we were able to also have immediate feedback on our products. Today, we have over 6,000 reviews of our products.
Many early stage brands are advised to take the omnichannel sales approach. What’s your response to that?
MH: The landscape has really changed for early stage brands. It used to be the tried and true strategy to focus on a particular channel, such as natural, and then proliferate there before moving into a new channel. Today, market forces have allowed emerging brands to shed these limitations.
For one, e-commerce is no longer relegated as an afterthought channel once you’ve conquered the other channels for additional revenue growth. E-commerce can be a wonderfully strategic channel. If you have an e-commerce friendly product where your cash flow is optimized, you can have a more direct relationship to the consumer, and you have access to your consumers’ feedback.
Second, today’s consumers have never been more educated about the brands and products they are buying and consuming. That has required conventional and mass retailers to incorporate natural products more and more into their stores as consumers vote with their dollars on the products and brands they want to support. In a single year, Nutpods added over 15,000 points of distribution, and that was found across the natural, specialty, conventional, club and mass channel with Target and Walmart. As long as your brand has the ability to scale operationally, brands are no longer having to stay and bide their time in a particular channel.
How has Nutpods utilized Amazon to become a leader in its category?
MH: Today, Nutpods still dominates with 60% of sales in the online plant-based creamer category. We continue to use Amazon for consumer insights such as how often they are buying our products and whether they are loyal to one SKU or more flexible across our portfolio and buy multiple flavors. We also utilize Amazon as an incubator channel so we can validate pricing and if new flavors or products are strong enough to introduce to retail. We are able to test out new sizes, flavors, bases and more to ensure we are developing what the consumer would like to see from us.
What’s your advice for early stage brands starting to sell on Amazon?
MH: First, focus on the early feedback of your brand. Even the bad reviews give you an opportunity to address or correct a product flaw. Reply to the bad reviews with grace.
Second, think of fulfillment costs as well as quantities to drive trial to your consumers. We started with a 12-pack case and then created a variety pack and a 4-pack to make it easier for potential consumers to try Nutpods.
Third, do everything you can to not stock out. It’s a punitive process where your discoverability and seller rating will be lowered, and you won’t be eligible for programs such as Black Friday or Lightening Deals.
Fourth, no, you don’t need an Amazon broker. We didn’t have any experience selling online, but we were resourceful and learned as much as we could from other brands. We have always handled our business in-house and recommend that brands should retain that knowledge.
Catch Madeline Haydon at Natural Products Expo West.
What: Natural Products Business School (education add-on required)
When: 7:30 a.m. - 4 p.m., Tuesday, Mar. 3, 2020
Where: Marriott, Grand F-K
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