This one is all about the big, bad, and bewildering “b” word …

🤑 Sean Frank on the only three metrics that define a brand

🏆 Mike Beckham asks what makes your brand the “best“

✅ Matt Bertiulli shares his 8-part brand health checklist

Plus, Cody Plofker reveals the two things he’s focused on, Mike Manheimer explains channel > checkbox, and the top-five headlines from this week in consumer news.

Did you know? We’re hosting the Operators Black Friday Webinar on Sep 12. You, me, and 25+ DTC speakers!

Cody Plofker CEO, Jones Road Beauty

The Secret to Smarter Growth Before Black Friday

Customer acquisition keeps getting harder.

And more expensive.

That’s why Jones Road has been focused on two things.

Aftersell helped us do both.

We started with Rokt Thanks, which transformed our confirmation page into a pure profit stream — no additional fulfillment costs with zero cannibalization.

Over a year later, it’s still a top-performing margin lever.

Now, we’ve added Rokt Ads, a performance channel that surfaces our brand after checkout across top ecommerce sites where real buyers (not browsers) are ready to convert.

If you’re looking to offset CAC, boost RPS, and grow with smarter infrastructure — not steeper ad budgets — Aftersell is who you want in your corner before Q4 hits.

↑ When you activate Rokt Thanks through our operator’s only landing page, you’ll get Aftersell’s premium upselling tools completely free for an entire year!

Sean Frank CEO, Ridge

What Does Brand Mean?

I think there are three traits you can point to that prove BRAND:

1- Pricing power.

Brand unlocks AOV.
Apple, Mercedes, Lululemon.

The classic BRAND examples all demand top of price point.

2- Best in class margin.

Because you have pricing power, you unlock margin.

Tesla makes more margin per car than every other automaker (besides Ferrari)

3- Repeat rate

Apple's best indication you will buy an iphone?
You already have an iphone.

Sure there are counterexamples...

Walmart has a great brand on low prices and low margins. But compared to who?

Its gross margin is still top tier compared to other grocery.

If you can't command premium pricing, generate superior margins, and drive repeat purchases, you do not have a brand.

People confuse brand with creative.

They think if their ads look premium, they've built something valuable. But you will go out of business if people do not buy your thing for a lot more than you make it for.

Founders get precious about their "brand."

They'll turn down creative that works, reject product extensions that make sense, or avoid channels that drive results.

Brand is not your personal taste projected onto your business…

It's what customers value enough to pay for repeatedly at high margin prices.

"Will people come back and buy it?"

Subscription, consumption, repeat - however you can do it, you have to figure this out.

Acquisition will always get more expensive.

Competition will go up.
You will saturate the market. If you can't get them to come back, you are just a transaction machine.

It will implode.

Most "brands" are transaction machines -
pretending to be brands.

To survive you need to be better than everyone else. To be better, you need to be launching new products.

While expanding margin.
While getting more attention.
While delivering value.

They start with visual identity, mission statements, brand values. Then they try to reverse-engineer business results.

It should be the opposite.

Start with pricing power, margin expansion, and repeat rate, then build ads, content, marketing, new products, partnerships…

Around those metrics.

I have never regretted launching a product. I have only ever regretted saying NO to a product.

The same applies to brand.
Don't say no to tactics that work because they don't fit your aesthetic.

Your brand isn't what you want it to be. It's what customers experience when they interact with you and the thing you sell.

They measure that experience in dollars spent, frequency of purchase, and willingness to pay more.

YOU SHOULD TOO

1- Pricing
2- Margins
3- Repeat

Everything else is brag marketing.

Mike Manheimer CCO, Postscript

SMS Should Be a Revenue Channel, Not a Checkbox

I’ve been thinking a lot lately about how brands treat SMS.

Too often, it gets relegated to a checkbox. Another line item in a marketing plan.

But the truth is … SMS isn’t just another channel.

That’s why the team at Postscript put together something I’m really excited about: The Ultimate SMS Guide.

It’s a step-by-step playbook that shows you how to turn SMS into a growth engine. Inside you’ll find:

• Proven list-growth strategies
• Campaigns built for engagement
• Optimization tips for automations
• Real brand examples to reference

There’s also a behind-the-scenes look at our AI SMS tools, including Infinity Testing.

Mike Beckham CEO, Simple Modern

To Be a Brand, You Have to Be the Best at Something

When I co-founded Simple Modern, people thought we were insane. We were entering a market dominated by incredible brands like Yeti and Hydro Flask.

Companies with hundreds of millions in resources.

Our secret wasn’t reinventing the wheel; it was finding white space in an established market.

Here’s the counterintuitive truth …

If you’re launching a product with no competition, there are only two possible reasons. Either there’s great demand and you are the first person on earth to tap into it (unlikely), or there’s simply not much demand for that product.

The most successful companies in the world sell an improved derivative of an already successful product.

Netflix took video and added streaming. Tesla took cars and added electric power. Apple took phones and added apps + internet connectivity.

You don’t have to reinvent the wheel. You do need a different strategy than your competition.

The leaders found initial success in specialty retailers. This success shaped their retail pricing and margin structure.

They had higher prices and fewer variations. That was our first white space — the place where we could be the best.

We built products for ecommerce rather than physical retail, and the underutilization of Amazon.

But being remarkable isn’t just about finding market gaps. It’s being distinctively better at something specific.

Distinctive is good. Distinctive is memorable. People are happy to pay a premium for distinctive.

Building a great brand requires remarkable product.

Product so good that people will voluntarily tell others about it.

Word-of-mouth marketing leads to free customer acquisition, but referrals are also the most valuable customers.

A customer who buys something based on the recommendation of another person will be more brand loyal than a customer who was converted through marketing.

What is a remarkable product? It has to be the best in at least one way. This is necessary because it makes it lovable and easy for people to explain to their friends.

• Best value
• Best tasting
• Most durable
• Longest lasting
• Best for health
• Best looking
• Most unique
• Best results

When someone can easily articulate why your product is superior in one specific way, they become your sales force.

They’ll tell their friends, “You have to try this tumbler. It’s the only one that has every print you’ll ever want,” or “I love this water bottle. It’s the only one I throw into my bag, never worry about spilling, and can still drink from comfortably.”

That’s not remarkable; that’s forgettable.

It’s also impossible, both for you and your customers.

People can’t remember or explain a product that’s “pretty good” at ten different things. But they’ll remember and recommend something that’s the absolute best at one.

When we developed our new straw lid, I spent weeks testing thousands of prototypes, drinking gallons of water daily.

Everyone in our company did.

That level of commitment to getting one thing perfect is what creates products people talk about.

Your product’s remarkable quality becomes your marketing message, your competitive advantage, and your customer acquisition engine all rolled into one.

But first, you have to do the hard work of identifying what your most remarkable thing is, then relentlessly pursue excellence in that dimension.

If you can’t answer that immediately and confidently, you’ve found your most important work.

THE FEED

​Building Two Brands: Jocko Fuel and Origin​

​From Growth Sprints to Brand Health Metrics: What’s Driving Wins Right Now​

The Trends

Curated by the editor of CPG Wire, this week’s five biggest consumer-news headlines.

1. PepsiCo Doubles Down on Celsius: Business Wire​

PepsiCo is investing another $585M into Celsius, bringing its total stake in the company to around 11% after conversion. More interestingly, Celsius is acquiring the Rockstar Energy brand from PepsiCo in the US and Canada.

PepsiCo originally acquired Rockstar Energy for $3.85B in 2020. Moving forward, Celsius will act as PepsiCo’s strategic energy lead in the US while PepsiCo handles domestic distribution.

2. Painterland Sisters Secure Funding: Twitter​

One of the fastest-growing yogurt brands in the US just closed a 7-figure seed funding round. The Angel Group, Supernatural Ventures, and Spacestation Investments co-led the round.

Founded in 2022 by sisters Stephanie and Hayley Painter, Painterland Sisters sold more than 5.7M cups in 2024. The brand previously raised $1.2M via crowdfunding platform Wefunder.

3. KDP Buys JDE Peet’s For $18B: CNBC​

Keurig Dr Pepper is buying Dutch coffee giant JDE Peet’s for $18B in cash. KDP also announced that it will split into two separate companies after the acquisition closes. One entity will house KDP’s North American beverage business — Dr Pepper, 7UP, Ghost, Core Water, etc. — while the other will be home to KDP’s coffee business and JDE Peet’s.

KDP’s coffee sales have declined in each of the past two years, so now it’s getting the carve-out treatment a la WK Kellogg.

4. Mammoth Brands Chases Coterie: Reuters​

Mammoth Brands — the owner of personal care brands like Harry’s, Flamingo, and Mando — is reportedly close to acquiring Coterie for around $650M. Founded in 2018 by Frank Yu, Coterie is best known for its high-performance diapers and baby wipes. Coterie’s annual revenue is said to be north of $200 million while EBITDA is in the $50M range.

Mammoth Brands has become a force in the personal care category with sales exceeding $830M in 2024.

5. Liquid I.V. Launches Energy Product: PR Newswire​

Liquid I.V. spent weeks teasing a canned product, but it was a clever ruse. It actually launched a Sugar-Free Energy Multiplier.

The product delivers 100mg of natural caffeine, five essential vitamins, electrolytes, and zero sugar. Liquid I.V. has been an enormous success story for Unilever since they acquired the brand in 2020. Liquid I.V. revenue has grown 4x and the brand is approaching $1B in annual sales.

Matthew Bertulli CEO, Lomi & Pela Case

Your Brand Health Checklist: What Makes a Great Brand?

Everyone has their definition of success, but mine is pretty simple. A great brand is profitable and relevant over the long term. Another word for this might be sustainable.

If you’re going to go through the pain of building a consumer brand, you should start out knowing that this is likely a ~10-year investment of your time, especially if you want to build something bigger than $50-$100M in revenue.

If you spend time on social, you’ll find lots of people bragging about how they scaled to $10-$20M in less than three years.

There’s always these examples.

There just aren’t many still around after five years. Even fewer after ten. The most profitable and enduring brands I’ve seen all went a lot slower.

They grew 20-30% per year, achieving large revenue numbers and profitability by compounding and — more importantly — through leverage.

To build a great brand, you need to know what one looks like. Lucky for you, there are proven leverage points in a consumer goods business that, when present, will be strong indicators of profitable performance.

Think of this like your consumer scorecard.

Your goal is to check as many of the boxes as possible. The more you check, the more your chances of success improve.

If you work for a consumer brand, you should be taking this to your leadership team and scoring yourselves. Knowing how you stack up provides clarity on where to focus your efforts.

Consider this your homework …

 Brand Health Checklist 

1. High Gross Margin
2. Low OpEx: <15%
3. Cash Conversion Cycle
4. First-Order Profitability
5. High Lifetime Value
6. Strong Organic Demand
7. Great Product
8. Large TAM

Learning the Hard Way: Pela Case

I first invested in Pela Case when it didn’t have any revenue. I met the inventor of the product, Jeremy, at a mastermind in California the year before. He had an idea I really liked — a more climate-friendly plastic alternative that could be used to make all manner of consumer goods, starting with a phone case.

I made the investment. Then got to work finding customers who would buy a compostable phone case made from plants.

This had never been done before.

We were entering a very competitive category that was quite mature and sort of overbuilt. Most people thought we were stupid. Many still do.

We learned the hard way that many of the standard operating procedures in the phone case industry weren’t sustainable.

Most of our competitors were burning money playing the traditional retail game. Even if they weren’t losing money, they certainly weren’t growing very fast.

We also discovered that to be competitive, we needed to find a way to differentiate our brand beyond the sustainability + eco-friendly niche we carved out for ourselves.

Having been in consumer for a long time, I started to reach into my network and talk to other operators building brands in product categories similar to Pela.

Accessories. Small. High-margin. Competitive. Design-oriented. DTC-first business models.

At the beginning, we had only three of the eight leverage points in this health checklist:

• High Gross Margins
• First-Order Profitability
• Large TAM

You might think, “That’s pretty good!” And it was.

But we weren’t consistently profitable, and the business felt difficult to run, more difficult than I thought it should be.

The first area we began working on was cash conversion cycle. The phone case industry has one major fatal flaw — inventory complexity. Apple, Google, Samsung, and the rest of the smartphone makers release new phones every year.

This demands new investments in tooling for phone case companies. Beyond just the phone models + sizes, you also have the added complexity of colors and designs. For reference, Pela Case today has more than 12,000 active SKUs on our .com, and we’re growing to ~40,000 across 62+ phone models.

Inventory complexity created a massive balance sheet and cash flow problem. Even if we could extend our payment terms with manufacturers to 90+ days, we were still guessing which phone models and design combinations to bring into inventory.

Our balance sheet was bloated. Cash, stretched. It sucked.

So we had a crazy idea. What if we brought our manufacturing in-house? Did it right in our own backyard here in British Columbia, Canada?

Everyone I talked to said this was stupid.

This has become a pattern in the outlier brands in consumer goods. The ones who do nine figures in revenue and healthy profit all do things that most conventional wisdom tells them not to. Even today, conventional wisdom tells you to ignore what these brands do because they’re big and can afford it.

My view is the opposite. These brands are big and profitable because they did it differently.

Making the decision to invest in our own manufacturing capabilities was not easy. It was also expensive. It slowed the business down for a couple of years while we restructured.

We had to shrink our team and focus more resources on building the manufacturing platform. We had to change our business from making 6-8 colors to making hundreds of designs, sometimes dropping 8-12 designs a week. The machine needed to be upgraded. It was painful.

We now manufacture the majority of our products for our DTC business right here in Canada. We make only what we sell and don’t rely on long-lead-time supply chains from China.

I share this story to show you that getting just one more leverage point on this list is very hard. It can take years.

In addition to going after our cash conversion cycle with owned manufacturing, we also improved upon some other areas. Our OpEx shrunk, and our product also improved. Today, our health checklist looks like this:

 Pela Case Health Checklist: 6 of 8 

1. High Gross Margin ✅
2. Low OpEx: <15% ✅
3. Cash Conversion Cycle ✅
4. First-Order Profitability ✅
5. High Lifetime Value 🚫
6. Strong Organic Demand 🚫
7. Great product ✅
8. Large TAM ✅

Let me explain some of these even more so you can see a very clear picture of what makes this business good to own and the areas where we are still improving.

1️⃣ High Gross Margin

Pela Case has 80-90% ex-factory margins. If you aren’t going to have strong LTV, you need super high day-one margins, especially if you intend on being heavy ecommerce.

2️⃣ Low Opex: <15%

This is really about payroll. Pela’s OpEx falls below this number because we made our team small and nimble. We’re mostly a team of generalists. We are constantly looking for ways to automate jobs to be done.

3️⃣ Cash Conversion Cycle

The basic idea here is that you get paid from your customers before you have to pay your suppliers.

The best brands in consumer all have negative cash conversion cycles. They mostly achieve this through very long payment terms with suppliers, usually >90 days.

Pela Case achieves our negative cash conversion cycle because we built our own manufacturing capabilities in Canada.

We manufacture the inventory we need for consumers as we sell it to them. This means we don’t have cash tied up in inventory.

I’ll write more on this when we get to the manufacturing section of this book. For now, it’s enough to know that this is a superpower for Pela.

4️⃣ First-Order Profitability

You need to be able to acquire customers profitably on day one. Banking on LTV is creating more difficulty in your business. Lots of people do it, but I wouldn’t recommend you start with this kind of model.

Pela Case has terrible LTV, so we have no choice but to make profit on every order in our business.

5️⃣ High Lifetime Value

We fail miserably here. People don’t buy multiple phone cases. Some do, but most don’t. As hard as it is to accept, LTV is far more determined by the nature of your product itself than “retention” tactics.

6️⃣ Strong Organic Demand

This is another weak area for us; however, but we’re getting better. We built the business entirely off the back of Meta and Google advertising.

The ecommerce industry as a whole is at a precarious stage in the lifecycle for paid ad platforms. They’re getting insanely expensive, we’re over-reliant, and most consumer goods categories don’t have the margins to win the game.

7️⃣ Great Product

I define a great product by how different it is combined with how much a user likes it. Pela has a really different product than our competition. Plus, we have a product people really like to use. Our marketing minors on the value proposition of eco-friendly sustainability; it majors on why people will love it.

8️⃣ Large TAM

Mobile accessories is a monster category. We’ve only scratched the surface.

 How to Use the Health Checklist  

If you’ve evaluated your brand and know your score out of eight, what’s next?

The very best operators focus relentlessly on improving their score. They pick one or two areas. Go hard after improving them. These areas form the basis for annual planning and major rocks in the business. They give you direction!

I’m lucky to have a huge network of brand builders who I’ve watched do this over the last 20 years. Some have even built in public. You may have seen them do it, too. A good example of this is Sean from Ridge.

None of them exist in a vacuum. Sometimes, you have to accept that getting them all might actually make your business weaker.

That’s the nuance in building in consumer. There is no “one right way” to do things. I know a few super profitable businesses that have only three of the eight leverage points …

But they make it work.

I’ve got two particular combinations of leverage that sometimes work against each other that I think we should explore before you move on from this chapter.

Large TAM vs. Cash Conversion Cycle

Without a large TAM, it’s going to be hard to get suppliers to give you really good payment terms. The reason is pretty simple.

Large markets usually have mature supply chains to go with them. Some manufacturers understand the market as well as you do. Sometimes better. This means they are more comfortable extending you better terms.

Smaller markets go hand-in-hand with uncertainty.

We saw this with Lomi.

There were no factories in China that made machines like Lomi. The first factories we worked with were very hesitant to extend us terms. This made our business incredibly cash-hungry. It was a big part of the reason why we raised venture capital.

First Order Profitability vs. LTV

Almost nothing I say in this book is absolute. With that, I have rarely seen great LTV brands be first-order profitable at scale.

Some do it. They’re unicorns. Most try to break even on day one of a new customer and make profit on repeat purchase rate. I know of many subscription businesses that operate this way.

Consumables usually mean you’re banking on LTV. Knowing this now will help you model your business out accordingly — particularly when it comes to cash flows.

Your score in this health checklist should help you figure out what to do next in your business.

I’ve looked at hundreds of brands through the lens of this health checklist. It’s surprisingly accurate at predicting the sustainable profitability of a brand.

I’ve also witnessed how the combination of many of these leverage points can help create a real moat around a brand.

This is the root of good strategy in consumer.

With thanks and anticipation,
Aaron Orendorff 🤓 Executive Editor

Disclaimer: Special thanks to Aftersell and Postscript for sponsoring the newsletter.

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