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A Seller's Guide To Amazon: Brand Secrets From Hint Water's Techie CEO

Dec 27 2013, 11:46am CST | by

A Seller's Guide To Amazon: Brand Secrets From Hint Water's Techie CEO
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Hint Water CEO Kara Goldin was a “burned out and exhausted” AOL executive and mother of four when she decided to leave tech and start a beverage company selling flavored bottled water.

Eight years later, Hint has become a staple in tech offices like Google and Square and a fixture in grocery stores like Whole Foods. While the private company won’t disclose revenue, Goldin says revenue is up 40% for 2013 and has grown sales 200% since two years ago, when its reported worth was $30 million.

As a CPG and tech veteran whose business depends much on the economics of the grocery store but also Amazon, Goldin stays on the pulse of founders’ struggles with both sectors. Here are some of her lessons for selling product, be it software or soft drink.

Ease into your plans for Amazon sales
Hint’s fastest growth in sales has come through Amazon, which reached out eighteen months ago to stock its own Hint inventory and sell on its site, boosting Hint’s sales by 200 percent since. Products that see the best lift on Amazon, Goldin argues, are those that can develop a subscription-type loyalty: many Hint drinkers consume 4-5 bottles of its flavored water each day.

Small brands have to do their own legwork before they get the tap from Amazon, though. “Amazon is about traffic, so if you’re a small business, you need something unique that will show up in their searches, so it’s best to launch yourself online and build up respectable SEO (search engine optimization.”

The best way to do that, Goldin says, is to target active communities. Hint thought it would do best with moms buying for kids, but it turned out to be as popular with women without children. Meanwhile communities for diabetics and cancer patients have embraced the product without Hint risking backlash by targeting either group directly.

Beware shady side deals by the competition
Hint’s biggest frustration is when it fights for shelf space with competitors from the major players like Pepsi and Coca-Cola, both of whom will sometimes underwrite their own product and provide monetary kickbacks to grocery chains in exchange for prominent placement.

The way to stand tough against such practices, Goldin says, is to stay patient and keep boots on the ground. Products that depart from a company’s main product line (think Coke or Diet Coke) can get neglected over time, hampering their ability to truly challenge a new market. In the meantime, however, Hint eats the high cost of employing seven sales representatives to continuously visit Whole Foods and other grocery locations to make sure the company’s products make it onto the shelf.

“It’s very expensive to pay those salaries just to walk into stores twice a day to staff them, but if I don’t do it, the big beverage companies will come in and mess with my space.”

The best celeb endorsements come from companies, not people
While John Legend is an investor in Hint, the company says it does not pay for celebrity endorsements like Vita Coco did with Rihanna. “I’m not sure celebrities really help, and it’s hard when they think their brand is more important than yours and they’re better than you are.”

Brand endorsements also run into messaging issues. Of three potential deals Hint has considered, two fell through only for the celebrities to run into gossipy controversy not long after, while a third fell through due to conflict with the unnamed celeb’s other promotion, for electronic cigarettes.

Instead, Hint has gone after the business and hype that comes from high profile corporate deals. Google is the company’s top endorser, with Hint Water fridges around Google’s main campus and a Hint employee on-call to keep the water flowing.

LinkedIn, NextDoor and Square are other high-profile tech companies where Hint is distributed. Twitter was a major customer until recently; Goldin claims over 100 Twitter employees showed up to protest at an optional meeting six months ago when Twitter stopped carrying the drinks.

Gaining traction at the larger tech firms was Hint’s success in this instance, as techies kept their favorite drinks in mind when they moved from one venture to another. Then rivals, investors and other influencers will also sign up to seem in the know. (As a caution, Goldin points to Hint’s Twitter lapse to show that such corporate deals often depend on third-party distributors and can come and go in cycles as employees filter through.)

CPG Execs: Your customer is the user, not the store

Goldin’s time at AOL taught her that all brands lose track of their core customers at their own peril. “You have to try things, so keep it simple and stick to simple offers. In tech, it’s much less expensive to test something and get a quick response from consumers.” That doesn’t mean, however, that brands should avoid testing–they just have to be efficient in how they do it. Hint still sets up displays for samples and tests, Goldin says, and regularly works on line extensions. Its blackberry flavor, for example, is now the brand’s top seller.

Whatever sectors your product is pitched to, remember exactly what that end user looks like, too–a problem that tech companies also face as they reconcile sales to big box stores with the actual sell-through that means their product is reaching a person. Within retail, brands from the niche to Coca-Cola can struggle when they focus on the wants of the distributor over that end user. “Ask yourself, ‘what’s the most convenient way to get to my brand?’’ says Goldin. Ease of access for your core customers should be the top priority of any sales installation and should extend to your brand marketing as well.

Silicon Valley execs–risk-taking starts with founders
Goldin would like to see Silicon Valley entrepreneurs be more willing to take risks outside their comfort zone. “I get a number of executives who call me with ideas for products, and it’s a common feeling that they say they don’t have the expertise to make a prototype.” The executives often come from software or online backgrounds and feel awkward, even gun-shy, about trying something more in the hardware space.

Building physical hardware isn’t easy. Goldin says eight years in, she’s still figuring the production and distribution models out. But when it comes to green-lighting an initiative to find out, Goldin says tech founders need to trust their own leadership and intuition after they’ve heard from their team of A-list investors and advisers. “Do you just surround yourself with people with opinions, or can you rely on your own will to make the right decision?”

Techies deserve credit, Goldin says, when they at least agonize over whether their startup is trying to do something new. “The thing about CPG that is brain-dead is that a lot of people launch me-too products. There was Vitamin Water and then there were 74 brands after that with nothing different, just the brand name.”

Still, the startup scene is chock-full of  derivative mobile apps that bill themselves as Snapchat for text or Instagram for dogs. And what about all those wearable devices coming to market? The distinction, Goldin says, is between a winning product seeing blatant copycats and early winners facing close competitors in immature new markets. “There aren’t as many me-too products in tech overall,” Goldin insists. “At least I’ll appreciate you put a different spin on it.”

Follow me on ForbesTwitter and Facebook for more tech coverage in startups, ad tech, enterprise software and venture capital.

Source: Forbes

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