Episode 45: Leveraging Online Success to Expand into Traditional Retail With Erin Chambers

Leveraging Online Success to Expand into Traditional Retail with Erin Chambers

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This episode of the Nerd Marketing Podcast features Erin Chambers, who runs marketing for haircare brand oVertone and skincare brand BOOM!. She dives into the complexity of marketing products both online and through traditional brick-and-mortar locations.

Erin provides insight into the retail environment and how to effectively use it to boost brand visibility, sales, and recognition. She shares the differences between online and retail marketing, the importance of growing strategically with retail, allocating budget for retail, and using sample sizes and offers to convert customers.

Guest Speaker: Erin Chambers

Erin Chambers is the guest speaker in this episode and kicks off a CPG-focused series with Drew and Michael. Erin is the VP Customer Acquisition & Retention at oVertone Color. Erin is the VP Customer Acquisition & Retention at oVertone Color. Erin’s a seasoned digital marketing leader specialized in Full Funnel Marketing Strategy for e-commerce brands.

Read the Transcript ↓

Today, we talked to Erin Chambers who runs marketing at haircare brand oVertone and skincare brand BOOM!. I know Erin personally because I'm a part owner of these companies. We acquired oVertone about a year ago with Juggernaut Capital Partners out of DC. I got to know Erin. It's a really interesting episode because what we wanted to dig into was how a CPG brand leverages success online DTC on their Shopify site to go into traditional brick and mortar. Overtone sells through Target. So we talked a lot about how to increase store velocity and how they think about Target as another channel. So hope you enjoy it.

Can you tell us who you are? I know you, but tell the audience who you are. Yeah, my elevator pitch. I'm a digital marketer, a mom, an avid skier and mountain biker, although I'm not really that great at either of those things, but I still like doing it all the time. Yeah, and my background, I think actually having undiagnosed ADHD probably helped me more in my marketing career than I recognized right away because I kind of popped around and did a bunch of different things like editing, PR, copywriting, all kinds of different stuff. And it sort of led me to becoming like a full stack marketer. And that's kind of where I am today. Yeah, which is great. You started in PR. I actually started in D2C and B2B. B2B journalism, actually. And then PR. So it's like the most nonlinear path ever. And now you're running marketing for a pretty big CPG brand or brands because you've got oVertone and BOOM!, which each of them are eight figure revenue businesses and we combine them. So you're kind of a hold co CMO now. Yeah, pretty much. And I know a little bit of it because I was a small part of the team that acquired Overtone maybe a year ago.

So you and I got to know each other. I think we really want to get more practitioners on here and VPs and heads of marketing to kind of talk about how to grow brands. And we're doing a little series now on CPG. That's consumer packaged goods. Throw another acronym out there. oVertone is a great example because you guys sell direct through your Shopify store and through Target. And on Amazon. Maybe we start there. It's like, how do you think of marketing for Shopify versus marketing for Target? Well, it's definitely very different because there's competition, a lot of competition directly in front of you in one area. And then marketing through your Shopify store, it's kind of like you are in whatever social media platform or browser, whatever anybody's using. So there's a little bit less like direct on shelf competition, apples to apples comparisons until you get later in the purchasing journey.

It's definitely a completely different beast. And my forte isn't retail. So it's something that I'm learning a lot along the way. And we've made some mistakes. We're correcting some of the mistakes and just optimizing everything from packaging to how we're communicating our retail presence in our digital channels as well.

Something I was surprised by in sitting through the oVertone meetings was like the amount of conversations around packaging and shelf presence and things that I never really had to deal with in D2C. Vertical space. Yeah. I feel like a lot of that we're lucky enough to have a private equity partner that has that background, strong background in traditional distribution. And that's kind of, I feel like a big value add.Yeah, absolutely. Because a lot of the things that you take for granted in the D2C space where you're just communicating to your customers on your digital shelf and you can put things where you want it to go. There's just some expectations consumers have when they're buying things in a retail environment that are just a little bit different.

Is it standard to have the same marketer run both? I don't know. I mean, I think it just depends on the size of the company that you're dealing with. I've always worked in super scrappy environments where I'm doing just as much as I'm strategizing. So I think for me, it's kind of makes sense to help out wherever is needed. But ideally, I think you'd probably have one person kind of in charge of retail and another in charge of digital, but then have that cross-functional communication where everything is seamlessfrom online to in-store.

How do you think about driving demand in online versus in retail? And how do you think about allocating budget? And what are the success metrics that you're looking for for online marketing versus retailmarketing? First, we kind of had to set the benchmark of just like what this new channel was going to look like to us in terms of revenue opportunity. The new channel being Target. Yes. It was kind of like a let's see what happens and follow the lead of the agency that we were working with at the time, participating in different in-store marketing opportunities or promos and just kind of setting a baseline for what our expectations were of how we could get away with obviously favoring our D2C channel, but still supporting our retail presence. Kind of about setting a baseline. And I think right now we kind of still are doing that because our D2C business is definitely bigger than our retail portion. So it's kind of finding a balance to where we're supporting our initiatives to expand into new doors or our product range that we have at retail while also making sure that we're not taking all of our bandwidth and putting it behind one of our smaller channels.

What are some of the ways that you're doing that to drive retail traffic and demand? So we are pushing out, like utilizing our email list and pushing out just to all of our users that we first of all are in Target. And if we're having any promotions, they're supporting those on like our social channels and saying like, hey, there's a sale going out at Target right now for hair color or our brand specifically, go check it out. So when those promo opportunities come up, we make sure to publicize those to our engaged audience so that we can make sure our units are turning on the shelf. So you aren't using your opt-in list for the Shopify store to push to Target?

Yes, it's definitely to a lesser extent than our D2C channel, but we're using it at just strategic touch points of like if we have a sale there or if there's a reason to push somebody there outside of just being there, then we're promoting it. Otherwise, we'd rather them come by from us. How big is Target? Is it like 5% of the business, 50% of the business? You don't have to give a number, but just... Yeah, it's definitely less than 10. So that's how you think about it. It's new, newish. Last year, less than 10, and you're not in every Target.

So is the goal, you want to nail store velocity in the Targets where you have a footprint to get more Targets? That definitely is the goal to make sure that we're striking a balance of supporting additional volume at Target and making sure we're hitting their sales goals for us as well as ours so that they will open more doors for us, take on more of our inventory so that we're really meeting a significant volume to where that margin concern is no longer a concern because we're hitting that level of volume where it kind of makes it non-material.

How often do you come up for review at Target? So they, and I think most retailers probably do the same thing, but they do an annual line review. And I believe they do it, I think different categories have different times of year when they do it, but for haircare and hair color, they do it at the same time every year. We've done two so far since we've been with them because we've been there for a little over two years. And that's kind of the time where you either, if it's your first time, you're pitching your brand, why you're different from other competitors on shelf and why they should want you to be on shelf for their different Target customers, and then pitch whatever part of your product line makes sense. For oVertone, we actually were reached out to directly by a Target buyer who was interested in picking up a very specific line of ours, our for brown hair line, which is fantasy hair color that will be effective on people who have medium to dark brown hair. She kind of came in and said, I want this, but pitch it back to me.

So we prepared a whole line review, what our cost would be, how we would market it with secondary packaging because we only had individual jars at the time and they require secondary packaging. So we put together our whole pitch and they bought it and brought us into, I don't even know how many stores at the time, I think 200-ish. But then on our last line review, Target's actually doing like a simplify to amplify kind of approach to their beauty aisles. So they're wanting less but more from brands. So our pitch to them this time was to take away some of our lower sellers in the for brown hair range, just two different skews that just weren't performing as well as the other colors were and replace them with some for blonde hair skews. So there would be that contextual relevance to customers on shelf and make the shopping decision more easy.

So if I go in there and I say I want pink hair, I see one that says this is for blonde hair. It'll work for me. Decision made. And same thing if you have brown hair. So that's kind of how it goes.You just pitch your brand, pitch your products and hope they like you. Are you pleased with going into traditional retail? Definitely because we've made money from it. I know it also has presented a ton of challenges. Yes. Pricing is another one where you lock in the price and then we can't change the price on the website. Yeah, I think it has helped from a brand awareness perspective.

I think honestly with oVertone, we went into it a little bit too soon. We probably should have had more ducks in a row, but it was kind of the timing of things. So yeah, I think overall it's good to be in as many channels as possible, especially with hair color, which can be such an impulse buy. You want to be where someone can go out and say, like, I'm coloring my hair. I can pick this up today and not have to wait for shipping. So I think, yeah, overall it's a good thing. What looking back would you have done differently or why do you think to some extent it was too soon?I think in a lot of ways at the time it was pre-acquisition for oVertone. It was a time when we were pulling just a lot of growth lovers and just guns blazing, just trying to do everything to just be in a good position to be acquired.

So I think it was some things were just rushed, like in terms of our pricing strategy, I think that was a little rushed. We honestly probably could have pushed for a bigger assortment. And I think we got the help we needed with retail a little too late. So if we would have gotten that support earlier from people who knew what they were doing instead of just kind of winging it with some smart people who thought they could just do it themselves. You got a lot of brands, D2C brands right now, and the CMOs and CEOs listening thinking moving into retail should be my main focus because it's like the silver bullet or it's the shiny object that's going to help us solve for growth or expand growth. And they might not be thinking about what are the risks or what are the challenges I could face by going in. So interesting to hear from somebody.

What are those ducks in a row that you feel like any brand should have in place before they think about pushing hard into retail? I think just making sure what works in your D2C channel in terms of margin and all of these things seem pretty simple, but especially for smaller companies or people who are new to retail, just making sure all of those things fit in a retail channel. And there's like buybacks and all kinds of other things that you just wouldn't know. So I would say making sure that you have an expert to consult with or guide you and make sure that the reasons you're going into retail will support the outcomes that you're going to get with everything that you have planned. Yeah, I would just really say like getting the expert help. And you got to honor the commitment for however long because you don't want to screw up a Target launch.

Yeah, and once you're in, you're kind of in unless you completely screw it up, which I think most brands could probably figure out how to get in and get there. It's kind of staying there. That's the bigger challenge. And once you're in, you're also kind of stuck with the deal you've made with that retailer for better or for worse. So everything needs to be just fully aligned from like marketing strategy to cost to everything, and the fly chain at all has to kind of make sense. That's the other risk that you alluded to, which is getting kicked out. You don't meet those commitments. And that's you're not out for a month while you fix things. You're potentially out for years until they're willing to revisit your brand. Is that right? Right. I mean, for sure. And there's always new competitors in every market. If your units aren't turning on the shelf, they'll find someone else.

I have an attribution question. You send out an email campaign to try to drive people to Target to purchase.Do you have any sense of whether that works? So it's kind of like a correlation attribution. It's obviously not a direct thing that you can track because Target doesn't really share any of their customer information for obvious reasons. But we can see units per store per week and see if they've lifted at all, especially like you can map people who live in a certain geographic location to the stores and those units per store per week. So you can kind of do some correlation exercises. But we honestly don't spend a ton of time on that. Is there someone on staff who does that? Some 50 pound head? It could be done. It's something that can be done. If you want to say how well did that email do to push the end doors at Target? I've calculated the correlations with this geo. Yeah.

That's another challenge that I think brands that are digitally native face when going to retail because they're used to this highly trackable direct response marketing campaign where they're seeing clear attribution from every sort of click through the funnel. And what's the ROI on this SMS first, this email campaign. And with retail, you really you're not going to get that. You're looking at just more of like M.E.R. Is that how you think about things overall sort of spend and allocating some budget to support your retail channels with an understanding that you just need to see a certain level of overall velocity? Yeah. And we're honestly not doing a ton of paid support. So really the the budget that we're putting behind Target, if we're if we're participating in a promo that's Target specific, we'll be able to kind of see the return from that. But anything that we do on our own side, it's just kind of a little bit of a mystery. But I think there's also there's all kinds of apps and platforms out there for like couponing. Like if you wanted to participate in some sort of like I bought a campaign, you could track a little bit closer that way. But with what our margins are with Target right now, we're not trying to do a ton of couponing. Yeah. Interesting. Makes sense. And then the play with with BOOM!, we've talked about over time with BOOM!.

Are you trying to get that into sort of traditional retail, too? Yes. So we are currently right now. We have courted some retailers and are continuing to do that. But I think that's also big for brand awareness and just getting in front of people where they're shopping with BOOM! demographic specifically, too. It's kind of amazing how much success they've had in DTC given that their demographic is more of a kind of in-store purchasing demo. So I think going omnichannel and getting in all of those retail stores are is an important part of their growth journey. You are probably one of the few people who run a holding company, but it's also must be analogous to having multiple products or product lines. Like, how do you devote time to how do you decide how to spend your day?Yeah. Well, it's honestly a struggle. I think just letting the KPI, like our weekly kind of financial KPIs sort of be the guide as well. We obviously have like kind of an overall strategy of what we're trying to do with both brands. But if one needs a little bit more love in a given week on a given channel, we'll kind of shift gears.

So it's kind of a juggling act, to be honest. I remember talking to a couple other friends who run portfolios and they found that it was it's very enticing as you get it up, you get the size up, like the multiples go up. But they found that the team couldn't take more than two or I don't know what the number was. It's like you gave a copywriter three brands and they did fine. If you give them four brands, they can't do the voice of each brand.I think a big part of because obviously I'm not executing every single thing we do. Like I'll occasionally jump in there and write copy. But the team is really executing all of our deliverables and all of our marketing materials. So making sure that we have a really good solid foundation for processes and expectations and are taking everyone's bandwidth into concern. So we're not having them shifting gears so like hecticly in a given week.

They really know what their what their priorities are, when their deadlines are, what the objectives are of each deliverable, big and small. So that's one of my big focuses is just trying to make sure the team knows what the priority is, even if I am like over here kind of juggling some stuff in the background. Drew and I both run holdcos as well. And one of the challenges was sort of resource allocation. You talked about prioritizing the team. Do you use the same folks across multiple brands or do you have specialists that serve only one specific brand and then use shared resources in other areas? It's a little bit of both. Our director level people work across both brands within their teams. There's some people who also work across both brands and then there are some people who don't.

For example, copy is completely separate so that that kind of brand voice isn't having to be shifted. I think that's one of the most difficult things to shift. So we've kept those separate so far. And then project management is also separate. But then those two project managers for both brands are really in lockstep with each other on what globally we're working on so that within those shared resources, they're making sure that we're not like accidentally setting deadlines over top of people and just really caring for the team's bandwidth and just raising their hand if something isn't possible to be done so that we can kind of shift what our priorities are. What's working for you guys right now? It's May 2023. The companies are profitable. Growth for everybody seems to be elusive right now. Is there any anything you can point to that's really working well for you, especially on the growth side?Honestly, D2C is so difficult right now for obvious reasons. It's just very expensive. The algorithms aren't great anymore. But I think what's kind of always worked for any digitally native company is the kind of driving trial play. So for oVertone, right now we're running this two for 20 hair color sample offer. And that was developed out of the data point that our sample size coloring condition conditioners were already the number one seller in our store. And we really didn't push them at all.

So we were like, wow, this product is selling like hotcakes and we're not even really talking about it. We just kind of have it as a different size variant. And we just didn't never really talked about them that much. So we were like, what if we use this as a carrot for new customers or somebody who's considering dying their hair, but they're maybe scared to or they don't want to change their brand or they just don't want to commit to like a full head of color? Let's sell them these little samples and they can try like some highlights or something hidden. And it's a it's a semi permanent conditioner, so it's not going to be there forever. So that offer has been doing really well for us. And we initially we thought it wasn't really working because obviously the average order value is low on that cart size. But we saw that people were coming back and buying again. And it was actually working just if we could get them to just try our product, they would come back and buy again. That's a great call out. We're seeing this across a ton of brands as well who are leading with this trial offer, inexpensive sample, as long as you're understanding sort of what those LTV to CAC ratios look like.

Yeah, it makes sense.Yeah, I think also pushing those offers with understanding like really why the consumer would want to buy something like this and what their reasoning would be for kind of going through with this conversion and buying this product is really important. And we did we did some customer surveys beforehand to really figure out like, why are people even buying this? Are they using it to color their whole head? Do we just have a bunch of people who have like buzz cuts who are using the sample size two ounce conditioner to color their whole hair? But a lot of people just wanted to try different shades. Some people were using it for different styles that just didn't require a foot, a full head of color. It was an interesting way to kind of get in front of different customers and the boom side. We're actually developing a new top of funnel offer right now that's based on like the no makeup kind of makeup look. It's kind of trending right now where people are just like less is more. I'm beautiful the way that I am. I just want something to like enhance my cheeks a little bit or get a little bit of a glow up. So we're selling two of the top products for a pretty good discount just to try those two core items and get somebody introduced to the brand and then check outtheir other assortment. So we're really excited about launching that one.

If you were starting something today with your extensive background in digital marketing and PR, what would you start? I mean, I don't know if you could tell by the sunburn that I have right now, but I'm very into sun care and sunblock, mineral sunblock specifically, just because skin cancer is prevalent in my husband's family. And it's just I don't want to prematurely age and I have tons of freckles and they just get worse and worse every time I'm out in the sun. You don't want skin cancer. Well, skin cancer is definitely the number one reason. But then there's all these fringe benefits that come with caring for your skin.

So I would start probably a sunscreen brand, especially because demand for sun care has consistently risen over the last, I don't know, like 20 years plus. People used to not care at all. And now it's just people are caring more and more and they're caring about reef friendly things and more and more people are caring about mineral based sunblocks instead of chemical sunblocks. And I think there's just a ton of white space opportunity there because there's a couple of brands that I'm sure you could rattle off the top of your head that are like Sunbomb and Vacation and Super Group. But there's just a lot of a lot of niche areas to kind of go in with like here's a point of differentiation, whether it's through ingredients or messaging or likemission driven, but I think could be super successful. Maybe incubate that.Yeah. So if anyone wants to invest, it's not easy to develop those because they are very high cost goods. And especially if you want to make like a custom formula, it's the seed money for that kind of thing. Awesome. Yeah, it was really fun. Hopefully there was some good insights in there that will help people. Thanks, Erin. Yeah, appreciate it.