S11 E4: Scaling a Brand: Deep Dive - Limited Supply

Summary

Podcast Summary: Limited Supply | Season 11, Episode 4: Scaling a Brand: Deep Dive

Host: Nik Sharma
Release Date: January 29, 2025
Title: Scaling a Brand: Deep Dive

Introduction

In Season 11, Episode 4 of Limited Supply, host Nik Sharma delves deep into the strategies and tactics essential for building and scaling direct-to-consumer (DTC) brands. Drawing from his extensive experience with over 100 brands monthly and his role at Sharma Brands, Nik provides candid insights into effective brand scaling, spotlighting both proven methodologies and common pitfalls to avoid.

The Foundations of Scaling a Brand

Nik begins by outlining the prerequisites for successfully scaling a brand:

Quality Product: Ensuring the product meets high standards.
Leadership Team: Having a competent and visionary team.
Adequate Funding: Securing the necessary financial resources.
Brand Equity: Leveraging existing brand recognition and loyalty.

"You have the funding necessary, you know, all the pieces have to be in place for this to work." [02:10]

Upper Funnel Marketing Strategies

Nik emphasizes the critical role of upper funnel marketing in driving brand awareness and engagement. He breaks down several key strategies:

1. TikTok Live

Nik highlights TikTok Live as a powerhouse for generating free eyeballs and fostering real-time engagement. He cites successful brands like Comfort Cotton and David Protein as exemplars.

"TikTok Live is like Facebook in 2012. There's so many eyeballs going to it, you would be a fool to not jump on it and play around with it." [05:15]

Key Tactics:

Creator Networks: Utilizing a network of creators to sustain live sessions.
Agencies with Mini Studios: Leveraging cost-effective setups to boost live content production.
Trend Identification: Staying ahead by tapping into emerging TikTok communities and trends.

2. TikTok Shop and Affiliates

TikTok Shop presents a lucrative arbitrage opportunity for brands to capitalize on organic traffic without heavy ad spend.

"If you're not playing in Shop Live and affiliates on TikTok then you're missing out on the greatest upper funnel opportunity that lets you earn basically free eyeballs." [09:45]

Advantages:

Social Proof: Authentic reviews and user-generated content enhance credibility.
Cost Efficiency: Lower costs compared to traditional paid advertising channels.

3. YouTube Creator Partnerships

Nik underscores the value of partnering with YouTubers, who excel in authentic content creation and audience engagement.

"Youtubers have the best skill set in terms of just talking to a camera. They have some of the best connection to the person viewing on the other side." [17:50]

Approaches:

Ad Creation: Collaborating with creators to produce genuine ads.
Equity Partnerships: Forming deeper alliances for long-term brand integration.
Retail Launches: Leveraging YouTubers to drive in-store traffic, exemplified by brands like Feastables.

4. Advertorials

Advertorials blend editorial storytelling with advertising, providing a narrative-driven approach to capturing consumer interest.

"An advertorial starts with a hook and a good story, something that they can relate to." [21:30]

Implementation:

Authentic Stories: Utilizing real customer experiences to build relatability.
Separate Publishers: Hosting advertorials on third-party platforms to optimize engagement and conversion rates.
Dual Funnel Impact: Enhancing both upper and lower funnel metrics through increased brand awareness and conversions.

5. Product Seeding

Distributing products to a diverse group of individuals generates organic reviews, content, and word-of-mouth marketing.

"Get your products out to a ton of people if you can afford it, get them in as many hands as possible and get reviews, get videos, get content." [25:00]

Targets for Seeding:

Influencers and Celebrities: Leveraging their reach for broader exposure.
Content Creators: Engaging creators with genuine interest in the product niche.
Media Producers: Collaborating with journalists and podcasters to feature the product in relevant segments.

6. Internal Creators

Investing in internal content creators can significantly boost a brand's storytelling and community engagement.

"Having somebody internally who can make a video in four minutes and put it up... it's just a great way to storytell that feels native." [28:45]

Benefits:

Rapid Content Production: Quickly testing and deploying various content pieces.
Platform Utilization: Maximizing the potential of platforms like TikTok, Instagram, and YouTube through consistent and authentic content.
Enhanced Community Management: Building stronger relationships with the audience through direct interaction.

7. TV and Direct Mail

While digital channels dominate, traditional mediums like TV and direct mail can supplement upper funnel strategies effectively.

"If you use something like a PostPilot, then you can use their prospecting tool or their lookalike tool and just test a handful of different pieces of creative." [29:30]

Strategies:

Creative Testing: Utilizing TV and direct mail to experiment with diverse creative approaches.
New Audience Segments: Reaching demographics that may be less active on digital platforms, thereby expanding brand reach.

Best Practices from Fast-Scaling Brands

Nik references brands such as Lemmy, Vuori, Hexclad, Armratt, and Mary Ruth Organics to illustrate effective scaling practices. These brands consistently follow a playbook that emphasizes launching high-quality products, generating buzz through upper funnel tactics, perfecting the buying journey, and maintaining strong customer retention through content creation.

"These companies are content machines, they're driving millions of eyeballs for free... they're focusing on the fundamentals." [14:20]

Conclusion and Next Steps

Nik wraps up the episode by highlighting the importance of mastering upper funnel strategies to create a fertile ground for sustained brand growth. He teases that the next episode will delve into lower funnel tactics, commerce experience, and measurement strategies.

"If you haven't signed up for the newsletter, sign up for it... next week we're going to go through the bottom of funnel, the commerce experience and the measurement stuff." [30:00]

Action Items:

Subscribe to the Newsletter: For additional insights and resources.
Engage on Social Media: Reach out via Twitter or email for questions and further discussion.
Prepare for Next Episode: Anticipate a comprehensive exploration of lower funnel strategies.

Notable Quotes

"As long as you keep launching very good products, it just keeps building the brand larger and larger and bringing in more new people." — Nik Sharma [10:50]
"There's nothing that gets me more upset or pissed off than when I see founders who are just not knowledgeable about what they're pitching." — Nik Sharma [04:30]
"People are more likely to watch a 27-second video from the front of an iPhone explaining the main ingredient in your eczema cream than an overproduced studio shot with a doctor." — Nik Sharma [28:15]

Final Thoughts

Season 11, Episode 4 of Limited Supply by Nik Sharma serves as a comprehensive guide for DTC brands aiming to scale effectively. By focusing on upper funnel strategies such as TikTok Live, YouTube partnerships, and authentic content creation, brands can build robust foundations that drive sustained growth and customer loyalty. Nik's pragmatic approach, backed by real-world examples and actionable tactics, provides invaluable insights for entrepreneurs and marketers alike.

For further information and to stay updated on upcoming episodes, make sure to subscribe to Limited Supply on your preferred podcast platform.

Transcript

A (0:01)

Welcome to season 11 of limited supply, a place for hot takes on what it's really like building and scaling consumer brands. I'm your host, Nick Sharma. Let's get into today's episode.

B (0:12)

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A (0:57)

Welcome back to Limited Supply. It's another week and so we've got another great episode lined up for you today. I wrote this newsletter this weekend and broke it down pretty in depth here and just kind of gave a lot more color around or more context around the stuff that I was talking about. So we didn't get through all of it because, I mean, this was a eight page plus newsletter. So we got through basically just the upper funnel stuff, which I think we'll hopefully give you some good ideas, insights, tactics, strategies, tips, you know, inspiration on how to drive more upper funnel awareness without spending an arm and a leg. And, and then next week we're going to cover the rest of the stuff. So listen to the episode, let me know what you think. Hit me up if you have any questions on Twitter or email and I hope you enjoy the episode. All right, welcome back to Limited Supply. This is another episode and today we're actually going to go deep. So this was something that I sent a newsletter recently and I got a ton of positive response and also I got a lot of asked to break this down on the podcast and just talk through it with candid thoughts around basically what I wrote. You know, when I write, I take something and it gets refined and refined and refined and refined till it's super simple. So hopefully with this podcast episode you can pause it right now and take a couple minutes to read it if you haven't read it yet. Otherwise, you know, basically what we're going to do is dive into it and just talk through it as if we're just having a conversation. And I'M just going to share my honest thoughts because the meeting that inspired this newsletter that I wrote was a 2025 planning meeting with a large brand. And it just got me thinking that, you know, what we are talking about in this room, which was basically one of the ad platforms, was kind of pitching what they wanted to push, which I assume comes from the product marketing team because a lot of those things didn't sound like they came from people who are well versed in media buying or running a brand. A lot of those things to me felt like they were just not the right things to focus on. And it inspired me to want to write out this basically eight page newsletter is what it came to be. So an eight page document of this is how I would approach scaling a brand. You know, obviously assuming that the product is good, you have a great leadership team, you have the funding necessary, you know, all the, all those pieces have to be in place for this to work. And you know, in this case, it's actually a very well known brand. And so it's, they've got great brand equity to play on. But what I wanted to do was just sort of talk about, you know, from everything that I see, from everything that I do, from every brand that I'm a part of and the brands I've invested in, you know, I get to see behind the scenes of probably over 100 brands every month and just see exactly who's doing what and how it's working and what channels are working and what tactics are not working and are working. And that's what inspired the same podcast episode I did around what's overrated versus underrated and where to stop wasting time. Because honestly, there's nothing that gets me more upset or pissed off than when I see founders who are, you know, not, not. They just don't have the knowledge of what the context of what is being told to them or being pitched to them and whoever's pitching it to them. Like, you know, either they know that what they're pitching is the wrong thing and they continue to pitch it because, you know, that's how their incentives are aligned or they, they just haven't done what, you know, what the context of what their pitching is. And so they don't know any better than to just sell whatever they're pushing or push whatever they're pushing. All that said, it just gets me fired up because there's account, you know, there's so many companies I've invested in where, you know, I'll see in an update that, oh, this you Know, this one company got us locked into a 12 month contract and now we can't get out of it unless we pay off the whole thing. Oh, we started working with this SMS platform and as soon as we needed to download our list, you know, we had to either pay up the whole contract or wait till the end of the contract to get our list. Oh, this, you know, this software decided to charge us $25,000 for because, but they gave us a good deal because they added a referral program and you know, they offered to add something else. And it's just like it gets me going crazy because it's just not, it's not, it's like you're just being taken advantage of and I think that's so messed up. And so anyways, I hate when that happens. And I wanted to put all this out on paper and now into a podcast so that hopefully this doesn't happen to you. But, you know. Yeah, let me know what you think. This is a much different type of episode. I would say it's still going to be, I guess, very tactical and whatnot, but a lot more conversational and a lot more kind of following the email. So without further ado, you know, whenever I see the growth marketing playbook or the, the brand building playbook, right? Especially around marketing, it starts with idea, like an idea you have for a product, something that you found a solution for a problem, whatever it is, and you're trying to figure out does this thing actually have legs. And so, you know, that's kind of the first thing that you focus on is testing this idea to see if it has product market fit. And you know, a lot of times if you're kind of being scrappy, you can get this done without any real, you know, investment into brand identity or things of that nature. You can just sort of test it, look at the metrics, see what kind of metrics you're looking for. You know, whether it's click through rate, whether it's conversion rate, whether it's, you know, whatever it is, and then decide if that's something that you want to continue with from there. You know, I think the next step is building out the brand identity and the visual identity, the tone of voice, the messaging, the positioning, the merchandising, you know, kind of like building the brand. When I say brand identity in this context, I don't just mean like the brand book, I mean sort of like what is the brand and why, why is this a brand? And you know, how is this brand going to be positioned to compete okay, so then once those two are established or sort of built out, then you move toward. And you know, a lot of this too starts with just bottom of funnel. You're just running some Facebook ads, maybe some Instagram ads. You're trying to see if something works, whatever it is. Then you move to the next kind of tranche of a few things. The first one is upper funnel marketing or top of funnel. So you know, top of funnel. Well, first of all, the funnel was created I think over a hundred years ago. I believe it was either over 100 or just around 50. But anyways, the funnel worked well when you were just thinking about billboards and TV and radio and newspaper and flyers and events or stadium, you know, things like that. The funnel concept works really well. But today the best way to just think about it is like you've got upper funnel and you've got lower funnel. The middle of the funnel is like, you know, you can, you can certainly do things there. It's basically just driving engagement. I think the most efficient way to do this, you know, if you're probably listening to this podcast, you work in E commerce or digital. So the most efficient way is to just have good customer experiences across different platforms because your customer or your prospects are going to be doing their own research. And that for them is the middle of the funnel, the upper funnel or top of funnel. That, that going back to is, you know, just driving awareness and creating, you know, you can call it clout, you can call it coolness. You want to build brand affinity, you want people to. To. To discover you basically. And then the bottom of the funnel is basically driving conversion. Right. So those are your lower funnel, Facebook ads, TikTok ads, things of that nature. Not to say those platforms can be used in an upper funnel manner as well, which we'll get into in a second when we dive into each tactic. But upper funnel and lower funnel is the best way to think about it. Then you've got the commerce experience, which is, you know, what happens when somebody clicks the ad, where are they going? What does that look like? How is that laid out? What is it offering, et cetera. You got measurement, which is another thing that I think so many brands are still not thinking about in the right way. If you listen to this podcast, you probably do, because I've talked about it so much, but there are so many huge brands that exist that are just not thinking. They just don't do measurement. And then the last one is now taking a customer and turning them into a repeat buyer or a subscriber or an evangelist or something of that nature. So let's get into it. You know, if you look at like some of the fastest scaling new brands that exist, whether it's Lemmy or Vuori or Hexclad or Armratt, Mary Ruth Organics, whatever it is, you know, they sort of follow this very straightforward playbook which is launch amazing products like find the best possible products that you can create, launch them, generate a bunch of noise and buzz with very smart top of funnel bets. And you know, my best advice is to watch, follow Lemmy, their email, their socials, follow Simon the founder, watch how they do product launches. It's a masterclass in product launches and top of funnel, then they make sure the buying journey is perfected. Whether that's, you know, Costco, whether that's their own retail that, whether that's their.com website or Amazon, then they continue launching products. And that leads to compounding brand effect because as long as you keep launching very good products, it just keeps building the brand larger and larger and bringing in more new people. And then the last one is just mastering the art of customer retention and producing content. All these brands I just mentioned are all content machines. Whether it's content that they're putting out themselves or that they are working to get out through a network of creators or affiliates or influencers or celebrities, whatever it may be, they're all kind of do it in their own way. But these companies are con. I mean they're content machines, they're driving millions of eyeballs for free. They're not paying for those. So that is sort of the playbook. And I think that all of them basically just focus on the fundamentals, right? So goes back to those things I just talked about. Top of funnel, bottom of funnel, commerce experience measurement, et cetera. So starting with top of funnel, let's talk about a few things that I think if you're scaling quickly you should be focusing on. First one is TikTok Live. So whether you are going live, you know, you listening to this or you the brand are going live, or you have create a creator network on TikTok that you have constantly going live, either one works. But the thing is that TikTok Live is like Facebook in 2012. There's so many eyeballs going to it, you would be a fool to not jump on it and play around with it. One of the best brands to follow for this is called Comfort C, F R T. Massive hoodie brand built on short form and, and meta and they crush both. They crush all aspects of TikTok, TikTok Shop, TikTok Live running sales, their own brand going live, a network of creators going live. They have, you know, 500 plus TikToks that go up a day from affiliates. I mean these guys are a brand to truly just study for TikTok other brands that crush it. David Protein does a really good job going live, running flash sales, etc. Mary Ruth Organics does it with their network of creators. Divi the. The Danny Austin's hair care company, also great example. I don't even think I've seen Danny, who is the face of the brand on the lives. She just has her own network of people that are constantly going live. So amazing examples. You should also look at what, you know, what I call TikTok native brands are doing when they go live. So ruse research R E U S they, from what I've seen, they mostly go live with their network of creators. Same with Smack. And they have a network of affiliates that are constantly going live. Guru Nanda has both their own brand and a network and Honey Glow is another one to look at. But, you know, study these brands the same way that you'd go to Facebook and look up your favorite brands and ads library. You should study these brands. When it comes to TikTok Live. Put their notifications on, watch what they're doing. It's very simple. There are agencies that now exist where they own, you know, a warehouse in Kentucky or Kansas City. And because the land is cheap and they get, you know, they'll fit 2550 mini studios of TikTok live into these warehouses. They'll bring two people on per brand and they just start ripping lives for eight hours. And yeah, it's, it's just think about the CPM compared to what you're paying on Facebook or any of these other channels. The cost of what you're gonna pay for a couple of creators and an agency to help you go live compared to paying for those same eyeballs on the, the paid ad side. Like it's, it's a total arbitrage which leads into the second point, which is TikTok shop and TikTok affiliates. This is the, this, this is the arbitrage opportunity right now to get in and figure out. Don't just wait for somebody else to figure it out for you. Just get in all those brands I just mentioned. Just study them. Just watch them for, you know, 30 minutes a day and see what they're doing. But if you're not playing in Shop Live and affiliates on TikTok then you're missing out on the greatest upper funnel opportunity that lets you earn basically free eyeballs. And I would highly recommend you check it out. The other thing is TikTok shop is only going to get one, it's only going to get more expensive to transact on. And two, it's only going to get more crowded and more competitive. And three, the reason that you also want to get on TikTok shop is the social proof on TikTok shop is probably some of the best social proof ever. I would say that if you told somebody that you had, you know, you had 5,000 sales on Amazon, they'd be like, okay, that's cool. If you told them you had 5,000 plus sales on TikTok shop, that's like, oh, everybody's buying that product. You know what I mean? So it's very worth getting that number up. And then the reviews, everybody knows you can't just fake the reviews on TikTok Shop. So the reviews are really high quality and a lot of people tend to post imagery with their reviews as well. Or you can just incentivize them to make a video talking about your product. So anyways, TikTok shop is. If I, if I. If you want to focus on TikTok for 2025, focus on the three things I just told you. You don't even need to spend a dollar on ads. Of course, everything that does well as a result, all the content that comes up as a result, you should take that and spark it and let you know yourself. Run ads behind that. But get really good at TikTok. And the last thing I'll say here is also get really good at identifying trends inside TikTok. So there are so many little communities with. I mean, there's probably millions of communities within TikTok and you know, just get in there and you know, Pookie is a great example of a community on TikTok that obviously got huge and probably more mainstream than the, than the average one. But there's so many communities on TikTok and if you're on TikTok as a brand, like, if you're disciplined about it, you'll be able to take advantage of some of these trends early on. And, you know, you can take that creative and put that into the paid side as well.