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- [00:00]
Ryan Reynolds
Hey, I'm Ryan Reynolds. Recently I asked Mint Mobile's legal team if big wireless companies are allowed to raise prices due to inflation. They said yes. And then when I asked if raising prices technically violates those onerous two year contracts, they said, what the are you talking about, you insane Hollywood. So to recap, we're cutting the price of mint unlimited from $30 a month to just $15 a month. Give it a try@mintmobile.com Switch $45 upfront.
- [00:25]
Unnamed Speaker (possibly a marketing representative)
Payment equivalent to $15 per month New customers on first three month plan only Taxes and fees extra speeds lower above.
- [00:29]
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- [01:18]
We're looking to elevate the conversation with parents around the importance of childhood creativity, the role it plays in their kids development, and the impact it makes on their life in terms of helping them develop the kind of skills that they could use regardless of a path that they choose to pursue. I think we can help change the conversation so it's not just brand A versus Brand B. And let's talk about the attributes of, you know, why one is better than the other. But really elevating it to what does this brand offer you that really taps into things that as a parent you care about and you want for your kids.
- [01:58]
Sarah Hofstetter
Welcome to today's episode of Brave Commerce.
- [02:01]
Rachel Tippograph
I'm Rachel Tippograph, the founder and CEO of Mi'kmaq.
- [02:04]
Sarah Hofstetter
I'm Sarah Hofstetter, president of Profitero and.
- [02:07]
Rachel Tippograph
This is a show that talks about what's relevant in E commerce for the world's biggest brands. Sarah When I first started my business it was against the backdrop where everyone thought the future of commerce was direct to consumer. And now that we are in the year 2024, it finally feels like people understand that direct to consumer takes a whole lot of money in manpower to pull off every single day. And we're starting to see the marketplace Change.
- [02:44]
Sarah Hofstetter
I don't want to sound super snotty, but payback's a bitch, man. There was so much inflation of enthusiasm around it to say, oh, I can work myself around the retailer, but you still have to do all the things that a retailer does. Your cost per acquisition is often through the roof. And while there are models where D2C makes a ton of sense, there are also models where you're like, okay, I'm not going to buy my cookies from one website, my pens from another website, and my knapsack from another website. That is the antithesis of simplicity. But that was the wave and we tried to fight it. You could be a trusted advisor, try to fight it, but ultimately, you know, that's where the valuations were being put. But now, now we're seeing the reverse, right?
- [03:28]
Rachel Tippograph
Yeah, we're watching people understand that really the billion dollar opportunities for commerce sit with big retail players and marketplaces. And that's not to discount the value of trying to collect first party data and doing something special for your high value customers. But everyone is starting to understand that the Brand.com commerce experience is an opportunity to, yes, collect some first party data, but really drive traffic and conversion at your biggest retail partners. And if you're looking for a living case study around this, you don't have to hear it from me at Mikmac, you can hear it from Victoria, who's been a long standing executive at Crayola that now leads marketing for them. But Prior was leading commerce and she was at the helm of making the strategic decision for Crayola to shut down their direct to consumer and just focus on mass retail. And so you'll hear from her why and what's happened to the business since.
- [04:27]
Sarah Hofstetter
On that note, let's have Victoria onto the show.
- [04:32]
Rachel Tippograph
Hello, Victoria.
- [04:34]
Unnamed Speaker (possibly a marketing representative)
Hello. Hello. Thanks for having me.
- [04:35]
Rachel Tippograph
Well, we're so excited. And it's funny, for a brand that is so loved, there is actually not a lot of information out there about the Crayola company. It's a private company. And while we at least here in the US feel like it has super strong relevance, I was really surprised to see how few employees actually work at the corporate headquarters. I believe it was less than 2,000. And you know, often we're talking with people on the show who have hundreds of thousand corporate employees, it still boggles my mind that all of this is happening with 2,000 employees. Is there something that is happening within the company culture or how you operate that's allowing everyone to have such an outsized impact at the organization?
- [05:24]
Victoria (last name not specified)
Absolutely. Rachel there's definitely a little bit of a special sauce with Crayola. And it goes back all the way to when we were founded over 120 years ago. The founders really believed in this idea that creativity really mattered and that it was important not only to each individual child, but also to our society as a collective whole. And it's really that deep sense of purpose and a commitment to make a difference in people's lives that really has remained pretty constant for Crayola as a company. It really shows up in how we operate, how we make decisions, how we decide which businesses to go into, where to invest. And it's also pretty transparent and consistent in terms of how we communicate with our employees, how every single person that works for Crayola around the world really sees and understands the brand, manages the business, and really kind of nurtures some of these special things about us as a company. So I think it's really because of those things that have really enabled us to make such a big impact, because frankly, we're not a very huge company. We don't have hundreds and thousands of employees. But yet our employees and what we call Crayolians are really committed to what we do. They have a greater sense of purpose and they have this passion to help make a difference in kids lives, in people's lives and teachers lives. And I think we are able to really create an impact that is much bigger than just, you know, strictly a physical business.
- [07:01]
Rachel Tippograph
Crayola global brand, you have a front row seat to probably understand how parents, children and educators are interacting across the world. When you go market to market, how do you see these different cohorts coming to life?
- [07:18]
Unnamed Speaker (possibly a marketing representative)
I think they will say that and then some. And what I mean by that is I think our yellow box, and specifically our crayon box is still by far our most iconic product and one that we're most frequently associated with, just because it's that box that is found in virtually like 90% of households with kids in that demo. And it's also virtually in every single classroom. So that iconic product will forever be most associated with the brand. Now, that said, over the last 10, 15 years, we've made a very conscious decision as a company to really diversify and invest in other parts of our business, specifically experiences like location based entertainment and interactive, as well as content, such as work that we do within education, as well as our entry with Guerrilla Studios into the entertainment space.
- [08:13]
Victoria (last name not specified)
So I think as you look at the newer generation, I believe we'll continue to play an even bigger role in kids lives as well as parents lives and educators lives. Because we are more diversified, we have more of those brand touch points and frankly we occupy a bigger share of kids time across those touch points.
- [08:31]
Ryan Reynolds
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- [09:00]
Unnamed Speaker (possibly a fitness app representative)
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- [09:32]
Ryan Reynolds
Acastic Ryan Reynolds here for I guess my hundredth mint commercial. No, no, no, no, no no, don't. No, no, no. I mean honestly when I started this I thought I only have to do like four of these. I mean it's unlimited to Premium Wireless for $15 a month. How are there still people paying two or three times that much? I'm sorry, I shouldn't be victim blaming here, give it a try@mintmobile.com switch whenever you're ready.
- [09:57]
Unnamed Speaker (possibly a marketing representative)
$45 upfront payment equivalent to $15 per month. New customers on first three month plan only Taxes and fees, extra speed slower above 40 gigabytes CD tails.
- [10:08]
Rachel Tippograph
What are some markets where Crayola is considered a challenger brand?
- [10:11]
Unnamed Speaker (possibly a marketing representative)
Well, I would say there's some markets, for example in Europe where there's a significant number of other brands in some of the core categories like pencils or markers. Not in every market. Crayons actually as big as they are in the United States and pencil might be the actually the primary tool and there's a lot of other brands, a lot of local brands that compete in that space. Where Crayola might be not the undisputed number one as we are in the us but it could be a number three number four brand in those markets.
- [10:43]
Sarah Hofstetter
When you look at that, the question becomes can you change consumer behavior or buyer behavior or not? Because people that are actually buying for, let's say for their kids, they're probably going with what they had when they were kids. And so is there a Way to disrupt the behavior within the category or is it a matter that Crayola has to adapt to the behaviors of the market? So how do you think of that push pull in those challenger markets?
- [11:12]
Unnamed Speaker (possibly a marketing representative)
Yeah, absolutely. Understanding about the consumer as well as the retailer dynamics in each individual market is always really important. That said is, I do think that there is a disruption component, as you said, that is a play here as well. I think an example of that is a campaign that we just launched earlier this year. It's called Crayola Campaign for Creativity where we're looking to elevate the conversation with parents around the importance of childhood creativity, the role it plays in their kids development and the impact it makes on their life in terms of helping them develop the kind of skills that they could use, regardless of a path that they choose to pursue. If we can elevate from a brand perspective the reason and the role for the brand and for these kinds of creative experiences, I think we can help change the conversation. So it's not just brand A versus brand B, and let's talk about the attributes of why one is better than the other, but really elevating it to what does this brand offer you that really taps into things that as a parent you care about and you want for your kids?
- [12:23]
Sarah Hofstetter
No, I think it's smart and anything within alliteration makes me happy. So Crayola Campaign for Creativity. I can get behind that. When we think about the role of taking all of that to market, you've got your typical distribution of, you know, mass and toy and even specialty, especially as you get outside the US and then there's been, you know, the hype around D2C and you guys have made a concerted decision, to my knowledge, to move away from D2C as a business model. Tell us more about that.
- [12:55]
Unnamed Speaker (possibly a marketing representative)
Well, I think if you think about it, there's a consumer perspective and then there's a business perspective. From a consumer perspective, that business was a meaningful value add because it gave consumers an easy way to really browse and understand that product portfolio, to look for products that they may not be able to easily find in mass retail, to be able to really, you know, if your child was inclined to any kind of particular experiences, it was just an easier way to navigate, to figure out what was there and what's available and what your child or your grandchild might be interested in. So it was a true value add from a consumer point of view. However, you know, when you look at the value chain from a business perspective, that didn't quite work. Quite as well in the sense that the supply chain and the cost structure necessary to really fulfill, to manage and to operate the dataset business is not insignificant. And when you look at Crayola products, we do not really have a significant lineup of unique products that are only available online. We make it easier to find. But most of those products are broadly available. And also as a brand, you know, the good news about the brand is that it's highly accessible, both in terms of availability, but also price points. But that's also becomes the, you know, a bit of a challenge in the D2C environment because frankly, the price point points aren't high enough often to justify creating the infrastructure and the supply chain required from a business perspective to be able to manage that kind of business. So as we went through and really analyzed, you know, as a company, you know, we've talked about a bigger brand than the company. Where are we going to allocate our resources and what are the really meaningful avenues of growth? And the conclusion that we sort of arrived at is that we think that consumer value from a perspective of exploration and discovery makes sense. The fulfillment and the value chain from the actual commerce perspective, not so much. So we made a conscious decision to sort of keep the upfront, but no longer create that and maintain that fulfillment infrastructure. So now we continue to maintain our product catalog. And the irony of it is it's actually now a broader catalog. We can showcase more of the products because we're no longer worried about the products that we actually are able to sell. We're able to feature our licensed products. We're able to give consumers a more cohesive view and exploration while using where to buy functionality to then enable them to convert a mass retail where we do not have to create and carry that infrastructure and those costs. So that's a decision that we made and we've transitioned about a year and a half ago. And I think the results in that space sort of speak for themselves.
- [15:42]
Rachel Tippograph
It's pretty big because obviously there was a decade of thought leadership around how D2C was the future growth vertical for many categories. And you see even large companies like Nike realize exactly what you just articulated.
- [15:56]
Unnamed Speaker (possibly a marketing representative)
Yeah, it was definitely fundamental decision. And there was a point in time where we thought this was going to be a much bigger growth engine. And I think we found exactly as you said, it was more difficult than I think everyone anticipated. And more importantly is as you're making those decisions on the investments and priorities and is this really the most lucrative and promising and frankly meaningful from a consumer point of view, are we adding something that is truly meaningful and helpful having made that decision? You know, when you look at where we are, despite the fact that we lost all of that sort of the shopping traffic on our website, our overall traffic is actually up despite that loss. So where consumers are still coming. And in fact, it made our website easier to navigate and easier to get to the things that we're actually looking for. So our traffic is up, the engagement with our content is up, the metrics in terms of where to buy conversion are really good. So when you kind of step back and look at it cohesively now, a year and a half is not a lifetime, but it's certainly enough time to be able to measure results effectively and frankly feel good that for us at least, it was the right decision.
- [17:11]
Rachel Tippograph
Well, that's awesome to hear. I'm sure your CFO was relieved. We have to ask you our famous last question, which is, what's the bravest thing you've ever done?
- [17:21]
Unnamed Speaker (possibly a marketing representative)
Well, I think for me, it was two things. One, going back earlier in my life, it's actually going through immigration. I went through that with my parents as a teenager, which is kind of a bit of a difficult age to do that and settle in your country when you don't speak the language or know anything about the culture. Culture, I guess, a little bit more recently, I still think it's having kids. It is incredibly rewarding and incredibly exciting. But also, you know, it can be tough, especially in an environment where you have a career and you have, you know, a professional, you know, an executive position. But one of the most rewarding things that one could do. But also, I think the bravest.
- [18:00]
Rachel Tippograph
Sarah, would you agree becoming a parent is the bravest?
- [18:04]
Sarah Hofstetter
I don't think I realized it at the time. So in retrospect, there's this, like, very fine line between bravery, surprise, crazy, and I think that's what parenting's all about. All the above.
- [18:18]
Unnamed Speaker (possibly a marketing representative)
I think you take the leap and you really kind of discover it's nanya new peel over time and the challenges are different and things evolve as you know, at different ages and stages. But I think as you sort of look back and I don't know how old your kids are, but you look at it and you say, yeah, absolutely, would do it again, but, man, is it not for the faint of heart.
- [18:41]
Sarah Hofstetter
It's never what you think it is. It's certainly a journey, and Crayola plays a very critical part in it. My kids are 25 and 23, and if you ask them some of the more iconic brands of their youth, they definitely would have said Crayola.
- [18:54]
Unnamed Speaker (possibly a marketing representative)
And I think that's a really special place to be for any brand to play that kind of role in people's lives, both in kids lives and their parents lives. And if we could do that well and we could continue continue to do that well, this brand can continue to thrive for another 120 years, which is fantastic.
- [19:14]
Rachel Tippograph
Well Victoria, we're so appreciative for your time, especially against the backdrop of the busy holiday season and we will all be on the lookout for what is next at Crayola.
- [19:22]
Unnamed Speaker (possibly a marketing representative)
That's great. Thank you so much for having me. I really enjoyed chatting with you today.
- [19:27]
Rachel Tippograph
If you like what you heard and you want to think about more brands that are playing at the intersection of both kids and parents, go check out an episode that we recorded live with Janda, the CMO and Mike, the Chief Commercial Officer of Campbell Snacks where they talk about the story of Goldfish. How Goldfish is not just for kids, it's for adults too. If you like what you heard, write a review. Tell a friend. Thanks for listening.
- [20:14]
Unnamed Speaker (possibly a fitness app representative)
Shorter days and chillier nights can make it tough to keep up your fall workout routine. Thankfully, there's Alo Moves, the app that brings health and wellness to the comfort of your home. Alo Moves offers yoga, Pilates, strength workouts and other fitness classes, plus wellness offerings like meditations, sound baths and more. Whether you have five minutes or an hour, Alo Moves has a class or flow that saves you from a frigid trip to the gym. Get a 30 day free trial and 20% off an annual membership with code acast@alomoves.com.
- [20:51]
Jackie Cooper
Hi, I'm Jackie Cooper, Global Chief Brand Officer at Edelman and the host of Touch of Truth, a new podcast launching on the Ad Week Podcast Network. My dad gave me this incredibly smart piece of advice. Meet everyone once. As a result, I've met some of the most fascinating and inspiring people on the planet. Now on Touch of Truth, we're coming center stage and sharing the mic to experience stories of truth, insights and visions for the future that will challenge your way of thinking. Touch of Truth is available wherever you listen to podcasts. New episodes come out every Tuesday. I do hope to see you there.