Seth Goldman of Honest Tea spoke at the Association for Corporate Growth (ACG) National Capital breakfast last Friday. He gave an extremely engaging address about the continuing success of his company, and the ways they work hard to stay true to their beliefs, especially after the Coca-Cola company purchased a 40% stake in 2008. My colleague Marc Hausman has a good review in his Strategic Guy blog.
Seth’s address covered a lot of elements needed to grow a business, but I came away with three big takeaways. First was know your market and purpose. Second, leverage current events and trends to help communicate your message. And finally, the necessity of continuous communication with your audiences — not just when you have an announcement, or a crisis.
Seth threw up an interesting slide that showed the market research they conducted to gauge the market audience for Honest Tea. There are three main market trends that are distinct but related — Health and Wellness, Environmental Consciousness and Social Responsibility. Where those three trends intersect is the sweet spot for Seth’s company, and they are all growing fast. Keeping faith to that focus has led to a 66% CAGR over the past 10 years and annual revenues approaching $70 million.
Seth also shared a great story about using current events and issues to support your corporate messaging. This past April President Obama visited Wall Street to make a major speech about the aftermath of the bailout package passed in early 2009. Honest Tea quickly set up stands on Wall Street with Tea and no personnel, asking customers to drop a dollar in a jar if they took a bottle. The theme was “Who Says There’s No Honest Tea on Wall Street?” A hidden camera captured it all. Turned out that 89% of partakers dropped some money in — extrapolate that as you will to Wall Street as a whole.
What a great concept and execution. In the Q&A I asked Seth how the company used that footage — the possibilities seemed almost unlimited. He told us they used it mainly to secure traditional media coverage, CNN among others. This makes a lot of sense for a consumer brand, but I think there are ways to go directly the Honest Tea audiences without going through the media filter. Here’s the video they put together:
Finally, an anecdote about the consumer reaction to new Honest Tea packaging really hit home for me. The company had changed the bottle design to reduce the use of plastic and their carbon footprint, but didn’t share this with consumers. So when some saw the new design, they immediately thought the company had reduced the amount of tea in each container to save costs, and Honest Tea received some negative feedback. They quickly added an explanation to each label to explain.
For me this was a great reminder — you can’t communicate episodically with your audiences, you need to do it ALL THE TIME. It kills me when I hear companies say “we really need PR now” — usually when they have a big announcement (they think big, anyway) or they have a crisis that needs containing. PR/Communications is not something you need NOW, you need it always. Even when you do something good that seems very self-explanatory to you. Social media channels can be extremely effective keeping these distribution and feedback loops open.
Strategic focuses on b2b and b2g PR, but I came away thinking Honest Tea would be a fantastic client. Seth is a good speaker who believes in what he’s doing – check him out if you get a chance.
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