How to Grow Your Brand Alongside Your Customer | Wunder 2023

Chelsea Grayson: I am going to speak as little as possible on this panel because we've got a quick 30 minutes and I've got a scary clock right in front of me. And I for sure want to reserve time for Q& A because these panelists are so fascinating. So I'll do a quick intro of myself, and explain a little bit about why they called me to moderate this panel, and then we'll just get right into it. This panel is going to talk a lot about, again, when you've got an organization that's built on core values and that's how you face your customer. So yes, you have a product or a service that you're offering, but you've built your company on core values that resonate with your company. How do you remain authentic to those core values? Because that's what drew your customer to you to begin with, but still make money because, this isn't a nonprofit panel. We're talking about capitalism here. So how do you remain true to your core values.

Rob Smith: Conscious capitalism.

Chelsea Grayson: Conscious capitalism, and still make your money? And then as things evolve along the timeline, and your customers want different things, or they tend to start valuing different things. Or you get new customers who value different things, and you want to broaden your audience, how do you continue to remain authentic to the foundation of your company? And especially in these times when even if you don't want to be transparent with your customer, you're going to be forced to be transparent with your customer. Because right now you can get on the internet and look up anything about any company, I don't care, public, private, closely held, small, big. You can find out who's on the board, you can find out who runs the company, what all of their backgrounds are, what it's really like to work in the four walls of that company. Are they really walking the walk or talking the talk? And so whether you want to be transparent or not, you're going to be transparent. So let's get right into it. So yes, I'm Chelsea Gray son, I'm the former CEO of American Apparel and True Religion, and most recently Spark Networks, which was a public company that owned a bunch of dating apps. So we necessarily, again, had to be very transparent with our customer about we're drawing you in to then make you totally obsolete to us, hopefully because we want to marry you off. But breakups and divorces happen, let's be honest. So we'll draw you back in if that happens too. So we had to be particularly brutal with our customer. But previously at American Apparel, that's a company that notwithstanding a lot of stories, I'm sure you guys have heard about the company along the years, and maybe read about in the press, hopefully with a good martini in your hand because it wasn't for the faint of heart. We were a company that was built on very specific core values, the most obvious of which was that we made everything in the US. In fact, we made everything in and around Los Angeles. And early on in the company's history, when we did brand studies, our customers said that first and foremost that was the most important thing to them. You got to continue to make in the US, it's American Apparel, not Bangladesh apparel, not Bangalore apparel. And so we continued to do that and it led us into a liquidity crisis. It's really expensive to make in the US, and you can get a lot more margin and a lot more bang for your buck if you're making offshore. But we felt that we couldn't do it because it wasn't going to be consistent with the values that we had established that were important to our customer. And it wasn't until much later on in the company's history when we really were starving for cash that we did another brand study with a follow- up question, which was, all right, cool, so you want this white t- shirt to be made in the US, but if this t- shirt was a buck less and it was made offshore, which one would you buy? And 100% of the responses came back, they'd buy the one that was made offshore, that was a little bit cheaper. So helped us to understand that our customer had evolved a long time and that we could start to offshore some of our manufacturing. So we were able to start shifting and being very transparent with the customer about, all right, this thing is made in the US with foreign components. This was designed here in Los Angeles, but we made it offshore. And we were able to be transparent and authentic to our customer, and ultimately that's what helped us bump up our margin and sell the company successfully. So that's a little story for you guys about shifting core values, but let me get to the panel. So first I'm going to have each of you, and maybe in the order that you guys are lined up, if you could do an intro of yourselves, and then talk about where you currently are, your company's core values, and how it is that you came to establish those core values. Whether that's how you wanted to start the company, or whether it was customer driven based on who you thought would be attracted to the product.

Rob Smith: You want me to go first?

Chelsea Grayson: Yeah.

Rob Smith: Great, thanks. Hey folks, my name is Rob Smith. I use he/ they pronouns. If you don't know what that means, I'll invite you to our workshop tomorrow, we could talk more about that. I am Mindy, inspired by Mindy. I'm a white man, tall, overly tanned right now. I spent a lot of time in the sun this summer, brown hair, and wearing a white shirt, and light blue pants, which are pretty fabulous. They're a collaboration from Phluid. I would say my company that I founded seven or six years ago, was grounded in values. It's fun to start your own company and think about what is important to me. And the first thing that I did was create a mission statement, which is, we challenge boundaries with humanity. So we question things of, why are things the way they are, could there be better way to do it? And then we challenge it with humanity, or kindness. In the spirit of this seminar of approaching someone and say, " Hey, can we try something different?" And then, the process of creating the values of the company, which are the pillars of the company, I call it. We start off, embed almost every presentation with our values, and even named our scent collection after our values. I'm wearing attention today, but they are, acceptance, balance, integrity, intention, openness, and fearlessness. And those are values that started off the process with about 500 post- its that we put up on a wall, and the team of us went through and edited down to these six. I will say I'm thinking about adding another one, which is abundance. We've been focusing a lot on that within our team thinking about instead of living in a place of scarcity, but living in a place of abundance. And really working with our retail partners to think about an and also approach to life. Why does it have to be one or the other? Could it be this and that? And that's just much more abundant, and it just opens up so much space. So that is the answer to your question, I think. Did I miss anything or just ramble?

Chelsea Grayson: The intro part was great. I'm wearing pants, I have brown hair. Vivian, can you beat that intro?

Vivian Chang: Hey everyone, I'm Vivian Chang. I head up direct to consumer capability within Clorox. So that's everything from the marketing side of acquiring and retaining, to the actual technology build among the fulfillment pipelines of that. But Clorox is a Fortune 500 CPG company with a portfolio of household consumer brands. So the actual Clorox bleach brand has been around for over 100, so we're around to build brands that will last for a long time. And so when it comes to corporate values, Clorox, we exist to help people be well and thrive every day. And so the values underneath that are really putting people at the center do the right thing, play to win. And so within the brand, we have everything from Hidden Valley Ranch, to Burt's Bees lip balms, and then supplements brands, obviously the cleaning brand. This specific configuration of the values, how's it show up to the consumers, who are the consumers? That's going to vary across that range. But the overarching is to really put people first. And the really great thing to see that is that is as much an internal motto that we live by as it is about external and how we show up. And I know we'll get into it later. I think that's really critical for showing up in a way that is transparent and authentic to consumers.

Chelsea Grayson: Can I ask you a quick follow- up question? Because you guys have so many little sub- brands under your big mothership, so I don't know a better way to say that. Do people not make that connection up so they just resonate with brand by brand, by brand? Or do you worry about being consistent across the board as a family of brands?

Vivian Chang: It's an interesting dynamic that we're wrestling with now. So it's not very outright, the family of brands, mostly because in our case, unlike a P& G, or a Unilever where the parent company doesn't stand for its own identity, Clorox for most people do. And so it's striking the balance of Clorox being known for efficacious, useful versus just the bleach side and killing everything, because we also have a lot around sustainability. And so it is a delicate balance that we're trying to figure out how to reach right.

Chelsea Grayson: A work in progress. Rebecca?

Rebecca Boston: Hi, I'm Rebecca Boston, I am the CMO of True Botanicals. My entire career has been marked by always working for values- based brands that make basically commodity products. And the way that we get people to convert and stay loyal is through our shared values. Before True Botanicals, I was responsible for the global social tsunami that was the launch of Fenty Beauty by Rihanna, which created what is now known as the Fenty Effect. Making not just the beauty industry, but all industries rethink how they are more inclusive in their marketing and the way that they operate their business. At True Botanicals, we are one of the fastest growing luxury skincare brands, and the easiest way to describe us is that we are the Tesla of beauty. We are making products clean and sustainable, and safe products that are cleaner, sexier, more effective, and cooler than the conventional stuff. And so our values are really around putting the safety of humans, animals, and mother Earth first, but then not sacrificing any performance for that whatsoever, and believing that that is possible.

Chelsea Grayson: Okay. So Vivian, I think I'll start with you on this next question. This is a very leading question. Over the past, call it three to five years, have you guys had to evolve your core values based on things that are happening in the marketplace? And do you do that because things are happening at that moment? Or do you do it because you look at the longevity of what's going on and figure this is going to be a long time play anyway, so I need to make this pivot? How do you decide which trends or which current market beliefs and values you're going to go with? And then to the extent that you've had to do that, or even if that's been crisis driven, for example, in your case a little bit, which I'm sure you'll get into that. And when you've had to pivot and show new core values, or evolve your core values, how have you remained authentic with your historical customers who might not want to see that change?

Vivian Chang: Yeah, there's a lot in there, and what I said earlier around we're building hundred year old brands, is almost like a grounding factor for us. And so it tends to be less of chasing the trends, or trying to pivot very frequently. On the flip side, it means that we have fairly conservative brands on the messaging that we're putting out there, fairly slow to make those pivots. But consumers know that they can rely on us, and that the products, and the R&D, and there's so much that goes into that part of it. So we're comfortable, I'd say, pivoting the marketing message around it, while the core value really is rooted in what are the actual goods that we're delivering and that is going to enhance consumers' lives. And so obviously during the pandemic, Clorox was in high demand, and every person was looking for these products. But it was a way for us to show up and show that this effectiveness and all of the research that has gone into developing the suites of products, you can rely on them. And so it was pivoting all of our resources on, how do we get supplies lighting up more plants, more contract manufacturing, and so forth. And we essentially did almost no advertising during that period, because if you can't find the product on shelf and then you go see a Clorox ad, that's going to be a little bit gradient as a consumer. And so instead it was about education, it was about equipping our hospital partners and our healthcare workers with Clorox Pro products, and really not talking a lot about growing household penetration, or any of our awareness media during that time. And then on the other side, it's sometimes choosing not to say anything. So I know we talked a little bit about BLM, so for some of our brands, actually for most of them, we chose to stay fairly silent because we didn't feel like we had a message that wasn't performative to go out there and say, and we weren't the most well educated brands out there. And so we just chose to stay out of that space, don't crowd the social media landscape, and let other brands who really have something to offer to consumers take in that space. And so that tends to be our choice a lot of times is actually to not say anything, do the right thing behind the scenes with our internal teams, and our employees, and partners, but not self- promote so much.

Chelsea Grayson: Right. Okay. Yes, that takes a lot of discipline. Rebecca?

Rebecca Boston: I agree. I have actually a really strong opinion on this. I think that consumers are very savvy, and they recognize it when brands are performative now. And so at True Botanicals on our team, we all know, we say, we participate in the conversation when there's a new societal issue that's come up, or cause. We participate if there's some way that we can contribute, whether that be financial, or whether it be through an action that we're taking. But if all we're doing is adding to the noise, we're not doing it. And that requires actually an immense amount of discipline, especially for us leaders because something will happen that maybe everyone that works on your team is really passionate about and you want to participate in the conversation. An example was Roe versus Wade, when it was overturned, all my team members came to me and they're like, " Why aren't we posting something?" And I said, " Well, let's get together and talk about how True Botanicals would be contributing to this cause, because if not, it's performative. So can we find a way?" And we weren't able to find one, so we ended up not participating. Whereas Black Lives Matter, when that was very much heated in the conversation, we took a step back and said, " How can we participate?" And we realized we can prioritizing sourcing more of our ingredients from black owned farms. And so we made a goal, we put together a plan, and then we shared that with our consumers. So it really is about, are we actually contributing and adding value? And if not, remain silent because brands are going to continue to get called out for not doing So.

Chelsea Grayson: Rebecca, you and I were having the most fascinating conversation out there. Could you share the anecdote about when your audience broadens a little bit, and how you remain true to your original audience while evolving with new customers?

Rebecca Boston: Yeah. So we're a clean and sustainable skincare brand. And when we first launched in 2015, there weren't a lot of clean brands on the market. And most of the customers that we acquired were very organic, of the earth, mamas, and all natural woman. But our products, remember, it's the Tesla of skincare, they're so high performance. So as we've grown and expanded, now the customers that we're acquiring, these are women who are getting Botox, they're spending thousands of dollars on Fraxel, they're getting facelifts. They invest a lot in their beauty, and now they love this product as well. And so our communications have evolved a little bit where we have to talk about the performance a little bit more, even though we haven't sacrificed how clean and sustainable we are at all. And what's interesting is that sometimes on social media, we'll get some of those OGers, they'll come and comment on a celebrity partner and be like, " That celebrity partner clearly has had so much plastic surgery, how dare you as a natural brand partner with them?" And we go in and we publicly respond and we say, " Our goal is for everyone to use safe and sustainable skincare regardless of whether or not they've gotten a nose job." And that shuts them up every time. And actually, it more gets them just take a step back and realize what we're trying to do, and that we're really just trying to be inclusive. And we've been able to retain both our old customers and then acquire all these new ones that way.

Chelsea Grayson: And at the end of the day, of course, you're a moneymaking operation, so you'd want to expand your customer base. But it's nice to do it that way. Rob?

Yep. So the first thing to do is just explain what Phluid is. So Phluid is first of all, the Phluid Project, which is a gender free fashion brand. We basically deconstruct gender and allow people to wear what makes them feel good regardless of how you identify, how you want to express yourself. And Phluid shows up in about 10, 000 points of distribution this year between airports, bookstores, department stores, big box, all over the place. And then there's Get Phluid, which is gender expansive training. So we help companies prepare for gender expansive, gender expressive workforce, consumer base. So we partner with lots of corporations. And then the Phluid Foundation, which is really about connecting with community. We've moved about a million dollars in the last two years to grassroots organizations across the country, primarily focused on the most at risk in the queer community, which includes trans women of color, and homeless queer youth. The life expectancy of trans women of color in this country is 35 years old, so we're really pushing to help lift these communities who are marginalized and really at risk. And what we like to do is work with corporations. A good example here, Saks On Fifth, who's here today, where we create product with them, they donate to the nonprofit, the Phluid Foundation. We help cast their entire campaign this year using one of our NGOs. And then we're working to close the gap and get jobs for trans women of color within Saks On Fifth to really finish up this job in the scope. But you mentioned throwing a curveball. So this last June was something unprecedented, at least unprecedented to this point. I think next year is going to be a bit more outrageous when it comes to Pride and companies showing up to support the queer community. And what we do is, we try to help companies prepare for what can be a backlash, help them to be really authentic and not performative. We talked about performative, and that means you have to engage with, first of all, your employees, really engage with the community and get grounded in community, and then do education and training. So from the CEO on down to the consumer facing employees, that they're prepared to have a conversation with someone. So it's really doing all these things together. And right now we've got a lot of companies that are afraid to go into Pride next year, and now is the time to start planning work with lots of our corporate partners, really big ones that have gotten a lot of heat recently, but helping them today start to get ready for next June. Which includes product development, which includes education and training, which includes give back and supporting the community. So it feels heavy right now. The brand started off feeling really light about freedom and self- expression, and it's shifted into this place that's heavy but essential. We'll work through it, just like we work through everything else.

Chelsea Grayson: Are those core values that are still the same freedom and expression and all that?

Rob Smith: Yeah, they're all the same. They're all the same, and they haven't changed. They're more important now than they were five, six years ago when I establish them. But also where abundance really comes in too. And that's the end also that yes, you can have a Christmas set up, or a Passover, but you can also have a Pride set up in that retailers can service all your customers, and recognize and affirm every customer and every employee. That's what it's about.

Chelsea Grayson: Yeah. That's fascinating. So Rebecca, I'm going to go to you first for this next one. So let's shift and talk about transparency a little bit, and what it means to you and the brands that you've worked with. So whether it's transparency where you've got to, like I said earlier, walk the walk on the inside of the four walls of your company. If you're expressing face forward to your customer, this is what we believe, these are the fundamental core values of our organization. How you have to live that within the four walls or not, if you can get away with not doing it, and how you do that. And also transparency with your customer with respect to how you collect data on them, how you analyze that data, how you ultimately weaponize that data. And then they're going to know that, and so how do you make them comfortable with the way that you're using and weaponizing data?

Rebecca Boston: So transparency is one of our core values because it's the right thing to do, but also because transparency equals trust, and trust equals revenue. And in the beauty industry, there's an immense amount of lack of trust because there has been so much green washing. Especially in the clean beauty world, there's been a lot of promises made about what products do that they don't do and such. And so our approach to transparency is we say, " Don't take it from us." Every claim we make is backed by a third party certification. So we invest a lot in partnering with third parties to help us with that. So when we say we're sustainable, we're backed by Made Safe, which is the most stringent certification available for sustainability for personal care products. When we say we're vegan, it's backed by PETA. When we say this product is going to diminish your fine lines and wrinkles, it's backed by a double- blind clinical study. And that has created so much trust in our brand, that's what we hear over, and over, and over again from our consumers. And that has really set us apart from the competition. And it requires time and investment, but it's 100% been worth it for our bottom line, and then also for what we believe from a values perspective.

Chelsea Grayson: And Vivian, let's get to you next.

Vivian Chang: Yeah. I think same thing. Transparency, I immediately jump to trust, and how are we building trust with our consumers. I said it before it starts with the products for us and the full supply chain, and who are we partnering with. I think similar with you all. Burt's Bees has 98% natural origin, and a majority of the ingredients we're actually doing site visits for a sustainable sourcing and investing back into the communities. Like in Ghana, they're helping with the Shea butter sourcing and training them to be beekeepers. And so there's as much emphasis on that side of it as what are we actually talking to consumers about. So I think it really does have to start there on transparency that we know that we can stand behind what we're selling. And then the other side, we are seeing, especially with newer consumers, younger consumers who want brands that they can resonate with, who match their own personal core values. And so things like the sustainability, or diversity, and all of that really does matter. And a lot of how we go about it is partnerships. So whether it's influencers that we're bringing in for Clorox Scentiva, we partner with Billy Porter. And then for Burt's Bees, over the holiday, did a product collab with Cleo Wade, and actually invited her in to help put some of her affirmations on the products. And then individuals could submit their phone number to get an SMS, 30 days of affirmation starting January 1st. And so for us, that's a way to have a win- win, because we are acquiring more first party data, we're acquiring phone numbers through that, but we're also offering something that consumers are saying, " Yes, I want that. I want those affirmations. I believe in what you're selling." And so I think that's really the challenge is that we try to say, what is the consumer need set that we're matching behind the data acquisition, behind the use cases. And we don't really push the envelope a whole lot in following someone across the web, and we really try not to be that creepy factor. We know you saw these things, and then now you're going to see it for the next 10 days, and we're sending you an email every day on it. And so if anything, we might be leaving some money on the table, but we think that is how you build longevity on a brand that ultimately consumers trust. And all of those pieces play into that idea of how are we being authentic to the consumers.

Chelsea Grayson: So fundamentally, it's saying to the customer, yes, we're going to collect your data. We have your mobile number, we're going to be texting you, but you're going to get bang for your buck. Yes, you know we're acquiring information about you that we're going to use for our benefit, but you're going to benefit as well. We're going to give you something great in return.

Vivian Chang: Exactly.

Chelsea Grayson: Great, Rob?

Rob Smith: Yeah, our transparency is essential for who we are. And we're at a really interesting place right now where we've got two key groups to focus on. One is our community, making sure that we're authentic, we're amplifying our community's voices, we're spotlighting them on our social platforms. And then in corporations who are other partners too. And walking the tightrope each day is, are we doing what's right for the community, but also not putting our corporate partners at risk because of who we are, what we say, what we stand for. And to me each day, that's a balance. I deleted two posts this morning from our TikTok account because they were too religious or political. And my team, I just let them do what they do, and then I delete it if I don't like it. So I wake up in the morning and be like, " Oh, shit." Delete that, delete that.

Chelsea Grayson: Just the micromanaging from our CEO.

Rob Smith: Let it rip. But it's interesting because we're transparent every day, and posting every single day, sometimes five times a day. And just putting stuff out there and making sure that it is challenging boundaries with humanity, but it's not pushing boundaries around religion or politics. But sometimes it's mushy, but it's a fun tightrope. Not fun, it's annoying sometimes.

Chelsea Grayson: That's fun.

Rob Smith: Sometimes it's tedious.

Chelsea Grayson: It's challenging.

Rob Smith: It's challenging. It's challenging.

Chelsea Grayson: Challenging, yeah.

Rob Smith: Yes, it's challenging but I love a good challenge. So that's our tightrope.

Chelsea Grayson: I want to get to Q& A momentarily, but Rebecca, again, you had another really interesting anecdote about how you treat social media when we were talking outside, about whether you respond to things or delete things, or what you leave up and what you don't leave up. Can you speak to that for just two seconds and then we'll get to some Q& A?

Rebecca Boston: Yeah. We were talking about in the early days of social marketing, I worked at Edelman Digital, I remember teaching clients this. You never delete any of the consumer's comments, that's how you're transparent and open is that you just let the conversation happen. But then I realized that we were allowing for bullying, and for things that our brand doesn't stand for on our profiles. And so for example, we have a rule that if anyone comments on a post that is a criticism of the woman's appearance in any way, that's usually what it is, we delete it. We delete it, and we don't allow for it. And we even filter out some words like ugly and fat, so that people can't even post that in the first place on our channels. And it's a big evolution, and it's one that you actually have to have a conversation about with your team and establish, what is an opinion we allow and what is an opinion that we absolutely are not going to allow to grow here on the internet. We have a responsibility as brands.

Rob Smith: Can I build on that? One of the things that we've started doing is, we are always in a trial, but we have started letting those comments stay in there, and watching the community jump on that person, and stand up for the person. Usually it's about their weight, or their orientation. But it's incredible to watch just people pounce on someone who comes across negative. And I love to keep that up just to show the power of community, and letting the values lead the way.

Chelsea Grayson: Yeah, I love that. Yeah. Okay. I don't want to take up too much more time. I do want to thank Wonder Kin. I've been an executive in residence with Wonder Kin for a really long time, I was originally a customer way back in the day when they were BounceX, if anybody else remembers that, before the brand transformation. So my heart is really with the company. Thanks for having us.