“Market based on markets: setting strategy to ensure efficient growth and return”

Seth:

Are you a fan of craft cider? If you are, chances are that you’ve probably had an Austin Eastciders dry cider (or you need to get out more!). But what’s equally as impressive as the crisp, not-too-sweet flavor of what’s in the can…is the strategy set and implemented by marketing head Dave Rule. By being consistent, available, and making the right investment for the market at hand (based on a number of factors), Dave has overseen rapid growth in his 3 years at Austin Eastciders.

Dave, thanks so much for being with us today!

Dave Rule:

Hi Seth, really happy to connect with you today!

Seth:

Dave, before we dive into how you’ve helped fuel Austin Eastciders rapid ascent, can you tell us a little about what’s in, and on, the can? What goes into creating your dry ciders, and what are some of the pillars of the brand that has been built around it?

Dave:

First and foremost is the what’s inside the can. Our cider is produced and packaged by our team in Austin, Texas (we’re the number one craft cider in Texas!) and is made the traditional way, using white wine yeast and real cider apples sourced from Europe. Austin is a big part of our DNA so we do put our own twist on a classic cider by using local ingredients like honey from Baytown, TX (for our Texas Honey Cider) and ruby red grapefruits from the Rio Grande Valley (for our Ruby Red Grapefruit variation). We keep a clean label and we source the best ingredients we can.

Our can packaging is telegraphic: bold but simple to really jump out at the consumer amongst a very cluttered beer shelf. Our branding goes back to simple classic hand-made signage with a logo that is a mixture of  hand-lettering and stencil styling. Our approach to design is very functional, you can recognize our visual language at a distance and it’s always easy to read and understand our creative. Right down to our very simple naming conventions “Original” “Pineapple” “Blood Orange” we always seek to be friendly, fun and to the point.

Internally we are guided by our brand values:

  • Authenticity: Produce traditionally influenced style ciders for all while being honest, transparent and candid with each other and our partners.
  • Caring: Do the right thing for the business and our people while being a good community member within our town, our markets and communities where we play.
  • Striving: Always striving for the finest expression of the Austin Eastciders brand.

Seth:

It’s a fantastic product and brand, and I can see why it has resonated so well. Okay, time to get into the fun stuff! Let’s talk about how you first approached the Austin Eastciders brand (and subsequent strategy). You had a product that was selling well on its own merits – but not a single marketing asset beyond the can itself. What were your first priorities?

Dave:

I learned from my experience at KIND that when you have a great product with an excellent package, it’s your best billboard. At Eastciders increasing sampling was definitely a first priority. We focus on the ground game first and we prioritize and deploy our marketing spends based on “proximity to purchase” both geographic proximity to stores that carry our product and w/ digital we focus intent to purchase through targeting and search. We keep it super simple. In a given geography, the more ubiquitous the distribution the more marketing tactics we feel comfortable deploying. So when we have a new market we simply focus in-store and in a place like Texas we have a more sophisticated marketing mix that includes in-store, media, supported events, owned events, owned-retail and more. In Texas we are now going for mass household penetration. In other markets we are looking to win pockets of retail within specific neighborhoods.

Seth:

We were lucky enough to have you speak about “punching above your weight class” at eBev last fall, and you shared some invaluable insights about growing a company where every person and dollar truly matter to your ultimate success. You mentioned the importance of brand consistency, physical availability, and making the right investment for the market you’re going after (based on distribution, value to the company, etc). How do you approach a nascent market differently from one you’re well distributed in, and what guides some of those investment decisions?

Dave:

Thank you, Seth. eBev was as lot of and I met some great people that have turned into fantastic resources. Especially you!

The nature of the beverage alcohol category requires that we have an enthusiastic distribution partner in new markets so we definitely start there. A lot of the work is also in identifying the right markets demographically: is there already a healthy craft beer/cider culture locally? Is there an appreciation for food & wine?

What’s cool about the beverage alcohol business is that it is still very much about relationships and often a lot of hand selling when you’re entering a new market. We empower our local sales and marketing teams to identify what is influencing buying decisions at key retailers. What kind of events are they attending? Let’s sponsor them and sample there. What causes are important to them? Let’s support them (and sample there!).

On the technical side we look at our by-market investments with P&L’s by geography. In a new market we are inevitably investing ahead of revenue and we have clear goals for when we would like to move past break-even and how we best believe we can get there.

On the consistency side we invested in the development of brand look and think books very early in the journey. We believe that every teammate should know our brand backwards and forwards and everyone needs to be empowered to execute against their local opportunities. As a result, we very rarely (almost never) see a piece of creative in the market that is not consistent with our brand. We are very proud of this point and we do it without being the “no police.”

Seth:

You also spoke at eBev about reaching and empowering groups/communities likely to align with your brand – noting that rather than make small investments across many different groups (e.g. music lovers, cyclists, etc.), your approach is to go a mile deep with one of them. How effective has this been at driving saliency amongst those who you do make an investment to target?

Dave:

We are absolutely community driven.  In each of our markets our field sales and marketing teams are embedded with groups that have an affinity for our brand. We qualify these groups with some simple questions. Are there a substantial number of members in this group? Is there an opportunity to connect with these people in a meaningful way? Do they have a lifestyle with frequent usage occasions for our product? Are these people easy for our team to access and connect with? If the answers point in the right direction, we put together a plan to support these groups. We find the people at the center of their culture and see how we can partner with them and add value. Some examples include things like focusing on WeWork locations across NYC to connect with active young professionals or supporting the cycling and music communities in Austin and the Art communities in Dallas and Houston. In all markets we seek to connect with people that are frequently going out to events. By being consistent and creating some frequency with a set of consumers we hope to break through the noise and be salient for those moments at the point of purchase.

I would say that it is working. We have an enthusiastic audience with high engagement and in the markets where we invest, we see a difference at retail.

Seth:

Alright…we love to conclude these interviews by looking ahead. Can you tell us where you see the cider market heading over the next 5 years? How long is the category growth sustainable – and what will separate the wheat from the chaff?

Dave:

Like the craft beer movement before it, the vitality – and promise – of craft cider is evidenced by the vibrancy of many local movements in markets across the country. I believe that we have grown from having something like 400 – 800 cideries in the US in the past 4 years. Cider was the original drink of America. It was what people drank in the frontier and we are here to help turn the US into a proud cider nation for a second time. As that energy gets bigger and more connected nationally, we think the sky’s the limit for cider. As consumers continue to eat and drink better, brands like ours that focus on real ingredients, less sugar (our ciders have 2/3 less sugar than our largest competitors), and unique true-to-food flavors will rise to the top.

We also believe that there is an opportunity to lean more heavily into the Better For You movement that has helped propel ciders growth. We launched a Super Dry seasonal over the new years with only 3 grams of sugar and it really flew off the shelves. With the raging popularity of products like alc. seltzer where consumers are prioritizing nutritional stats over flavor we believe that cider can provide a much superior flavor experience and still deliver on target metabolics. Moving forward we believe there is a market for people that don’t want to compromise one for the other (Flavor vs. Nutritional measures).

Seth:

Dave, thanks so much for sharing your insights today! This was awesome. Hopefully, we’ll have the pleasure of having you at eBev again this year. 

Dave:

Thank you, Seth! This was a lot of fun. See you soon in Vegas.

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