Article 07: The vehicles of promotion
Daag ache hain..
White ho toh _______ ho!
Hema, Rekha, Jaya, aur Sushma… Sabki pasand _______!
Did that Nirma jingle before the YouTube video annoy you? Aah, we apologize! and hence we skipped it for you. This article is not about detergents, but our motive totally plans on washing off some misconceptions about marketing promotion by expanding on three sock companies that pitched on the show. There is enough talk about the creative genius in designing ads however the focus of this article is not creativity in design but about the creativity in choosing the vehicles to deliver the very message. Before that, did you know our favorite Consumer Packaged Goods (CPG) brands like the ones mentioned above that are household names invest almost 8–10% of their revenue on creative ads year on year?
Let’s conduct a thought experiment:
Unilever stops advertising Surf Excel, will it lose all business? Maybe not.
But will it be able to keep all business? For sure not!
To keep a product, a service, or even oneself on the top of mind, an enterprise needs to get itself heard, contemplate what they want to get known for, and strategize the vehicle to achieve this goal. Promotion campaigns via TV, newspapers, radio were previously considered as the only method of communicating a message to a wider audience however in today’s world, there are multiple ways of promoting a business using a mesh of vehicles for every stage in the AIDA* model. The examples of AIDA include social media platforms that know your personality type, search engine that knows what you are searching for, and e-commerce platform that knows what do you intend to buy.
AIDA = Awareness → Interest → Desire → Action
The accessibility of advertising on digital platforms has allowed many smaller companies to go from idea to scale in no time. A small business owner can never think of advertising on TV, radio but can easily avail digital ad platforms like Facebook ads where the costs for signing up are negligible and business owners pay proportionally for hyper-focused targeted marketing.
Let’s consider the case of Dahlia Rizk, who pitched “Buckle me up” on the show in S12 E07. She makes for a classic case of how to leverage the power of Facebook targeted marketing to launch a company. She had this idea for safe coats for kids 15 years ago when she was a young mother to 3. Not knowing how to commercialize her idea, Dahlia didn’t pursue it at that time. However, she had her deja vu moment when she encountered another young mother struggling with same problem and thought to herself, why is this still not solved? And went ahead and launched her company, which previously was next to impossible for her. She could reach her audience (in this case to young mothers) at smaller budgets.
Now that we have understood the transformation that occurred in marketing due to technological advances, let’s expand on how three companies selling the age-old product - “Sock” have used very different marketing vehicles thus originating and dominating an entirely new niche.
Foot Cardigan, a direct to consumer (D2C) sock subscription company pitched on Shark Tank in S07 E03. Each month, their subscribers would receive a random pair of socks sourced from over 50 designs that the company concocts. Sock-subscription is crowded space however after listening to the savvy entrepreneurs talk about CAC*, LTV* etc. Cuban sniffed out their tech background in SEO and web design. Though Mark Cuban wasn’t too hot on the idea itself, he decided to bet on the tech marketing expertise of the founders.
(*CAC: Customer acquisition cost, LTV: Life time value — more on these concepts in coming articles)
SEO: It is really easy and complicated at the same time. Put a block of text with the insertion of keywords relevant to the page and also the website and use those keywords as anchor phrases for site interlinking. This approach contributes to pages link popularity and improves user factors such as pages seen per visit and average time on site and that’s exactly an online business would want from it’s consumers. Companies that invest in building content and gaining traction by SEO survive the battle of rate cutting and ad campaigns. The founders of Foot Cardigan know this reality though Socks is a cut-throat business, they have flourished.
Sharks got excited to see Sofia Overton, a kidpreneur on the set in S11 E10 pitching her novel Sock idea - Wise Pocket founder. It is remarkable that a teenager can see a need for a product enhancement and goes after the idea. She designed socks with inner pockets that allows kids to store their phones and other small items. It gives shivers to an MBA to think of starting and running a business, maybe think about a kid? But with advent of crowdfunding platforms like IndieGogo, it doesn’t look like a far fetched dream. Sofia launched her project on Indiegogo and reached her funding goal and ba-bam! a teenager was in business!
Indiegogo (or Kickstarter) : It is a global crowdfunding platform focused on creativity. This model traces its roots to the subscription model of arts patronage, where artists would go directly to their audiences to fund their work including films, music, technology, and food to name a few. Project creators choose a deadline and a minimum funding goal. If the goal is not met by the deadline, no funds are collected (a kind of assurance contract). People who back Kickstarter projects are offered tangible rewards or experiences in exchange for their pledges (monetary contributions). In our point of view, with the push for startup economy and self reliance, Government of India also needs to push for adoption of platform on similar lines.
Moving to our final Sock company and one of the biggest successes on the show - Bombas. When Bombas pitched on the show in S06 E01, Kevin O’leary in his trademark ‘in your face’ commenting style called them Sock cockroaches, waiting to be crushed. The reality sure is far from the prediction. So it all started when Heath (founder) stumbled upon a Facebook post that said socks were the most requested clothing item at homeless shelters and that statistic made him uncomfortable and he decided to launch ‘Buy one - Give one’ sock company. The social cause had a positive marketing effect and took them to 100 million in revenue in just a few years.
Social cause: Social impact and marketing aren’t the same. But, are they not? At times, brands commit themselves to a social mission which may or may not be directly linked to their business however this approach allows them to make great strides in making an impact, while enhancing their profiles and act as a growth driver. It also helps them in driving their team towards a mission beyond increase in revenue. Today companies like Unilever have a leadership member focused on this singular goal in the position of Chief Impact Officer. Now, isn’t that something?
So, that was interesting and then some!
Marketing is not only about crafting the smartest, cutest, or savviest message it is all about augmenting and accelerating growth for the company. Many startups think like failed musicians, too much time creating and little time promoting. Marketing message communication has a lot of moving parts and complexities, it is an integral aspect of a business’s success and the lack of it can become a reason for business’s failure!
This is our seventh in a series of articles on Shark Tank, where we try to deconstruct the pitches, business fundamentals, and the Sharks.
*Copyrights of the images are owned by the authors.
