Ep 28. David Lemley, Founder of Retail Voodoo on retail and “Better For You” Brands.

A pioneer in retail with a purpose, talks the upsurge in healthier products and how to create a brand for long-term success.

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Hey everyone, this is Rudy Fernandez from Creative Outhouse. On this episode I spoke with David Lemley, the Founder and Chief Strategist at Retail Voodoo, the brand building firm that focuses on the Better For You category. It’s a category that’s just boomed over the last few years as consumers look for healthier ways of eating and living. David’s worked with big brands like Starbucks and REI and Kind Bars to name a few. And he really digs in deep to figure out what it takes to build a strong and lasting brand. He outlines his systematic approach in his book, Beloved & Dominant Brands. It’s a thoughtful analysis and process. You can find a link to it on our website with this podcast. So you’re ready to learn some valuable stuff with David Lemley. Welcome to Marketing Upheaval.

Rudy:

Welcome to Marketing Upheaval. My guest is David Lemley, president of Retail Voodoo, a retail brand building firm that focuses on the Better For You category. David has helped some well known brands become well, well known. He worked with a team to help Starbucks go from 800 stores to infinity.

He’s worked with REI, Nike Town, Kind Bars and many others. Retail is one of those worlds where sales transactions are King. But David is a pioneer in retail with a purpose. He’s an expert in retail brands that have great sales, but also improve lives. His book, beloved dominant brands touches on that and we’re going to talk about today. So welcome, David.

David:

Thanks Rudy, that was a really great into, and I’m excited to be on the show.

Rudy:

Well, we’re excited to have you here. You know, it’s funny, I was not familiar with the category of Better for You brands. I don’t know if it was just me not knowing they existed. And the funny thing is that I’m very familiar with all the Better for You brands because my wife is a health food evangelist. And I never knew the category. How mainstream is it as a category?

David:

It is becoming Increasingly mainstream. I would say that eight, nine years ago, if you talked about Better for You and even pure organic or verified non GMO or clean ingredient, you are considered a little bit of a wacko or a little bit of a hippie. Now, what I can tell you is that Walmart and Costco are the two biggest buyers and suppliers of organic products. So I think it is very much pushing towards the mainstream.

Rudy:

What do you think’s causing that growth in that in that particular area?

David:

Well, I think it’s a combination. I think first there’s the technological ability to grow things is advanced so people can actually get a good organic yield. I also think food science has evolved a lot. And all of this comes from our response to big Ag and products filled with crap and disease and I think that people who are on the planet right now, realize that you are what you eat to some extent, even if that’s hot dogs and hamburgers – which I love me a good hot dog. I’m not saying that. But I think that there’s an awakening of, if you want to live a higher quality of life, you need to eat better and take care of yourself.

Rudy:

Yeah, I’ve noticed that too. More and more people care about what goes in their body. And it just seems to have grown, probably slowly, but it’s been becoming more aware of it, you know, in more in recent years.

David:

Yeah. Retailers like Kroger, for example, have really helped push the envelope to get it mainstream. It used to be that when you went into either you went to a natural organic store or you went to your conventional grocer and they had one small section with a few kind of, you know, bruised apples and a couple of wilted lettuce, or there might be a section of really bad kale chips that were on one small section. And that was all relegated to one area. And if you actually think about how you go into grocery now organic is integrated writing it’s no longer its own strange, isolated section and the stories put the better for you products are put right next to the original. So if you think about like Cheetos, for example and think about how many puffs there are now, that’s a good example of Better For You going mainstream and Frito Lay’s response was to make an organic Cheetos.

Rudy:

I’ve not tried that.

David:

They’re yummy.

Rudy:

I felt like all of a sudden, I started seeing Kind Bars everywhere. Whereas I you know, when they first came out, it’s just they didn’t go from like one obscure store. I just saw them everywhere I went. I’ve seen that with so many products. It’s amazing how quickly it’s been adopted.

David:

Better for You brands are pretty entrepreneurial, and they’re sharp, and they’re swift and they’re hungry. And so they’re doing things like creating direct to consumer tribes and they are using alternate distribution. So they might go into or rather than saying, Well, can I go get on the shelf at Target? First, they might go choose or can I get to Costco or Walmart? Can I go somewhere else and prove that I have traction, create a little bit of a phone so that by the time it shows up in a mass store, everyone feels like it’s, it belongs there?

Rudy:

Well, that’s a good segue, because in your book, you outlined the lifecycle of the Better for You brands. First, they start, and they’re introduced, and they’re the first and only then they become the dominant by default. And they fall as more competitors come in, and they drop into the one of many. So how do you help prepare clients for that journey?

David:

So it kind of depends on who they are and where they are in that journey. But to kind of set up the notion of how you go from one and only to one of many, is, let’s say, you have some amazing innovation, that’s usually what’s driving new product. You found an unmet need, you’ve got an audience that really wants you to make something for them and it gets into their lives. Not just from a features and benefits perspective, but also from who they get to be when they’re with us perspective. And if it’s any good at all and has any, any benefit in any story to it, it will be copied. And that’s how you get one of many. And we talked a little bit about retailers, you go in and let’s say you are a Kind Bar, how many Kind-esque items are out there in the world right now. So the way they defend that is by choosing to speak in a way that calls to a certain tribe and they therefore become the category leader of that type of individual. In the case of Kind, its ingredients you can see and pronounce and being kind to yourself your taste buds and the planet. So you get a delicious snack and you get to be a do-gooder by default. So there’s that’s how they’re defending it. But we have found with brands is that when they have a a new idea. And they get to that dominant by default, they are not aware of or expecting to become one of many. And so oftentimes they are caught unaware and are more slow to respond, which is really unusual for a brand that was created or an idea that was created based on being entrepreneurial, swift and sharp. That so much of what I think about this is very similar to how Ed Farley talked about it on your previous show, where y’all talked about how it needs to be emotional driven, and it needs to be a story people can opt into and aspire to be a part of. And I think that that is how you get to that. He also talked with you about some of the tactics of how to get there and how important understanding what your customer needs to know about you and understanding what the real competitive set is through the through a category audit.

Rudy:

I love the phrase who they get to be with you. We do a lot of behavior change campaigns and one of the things we say always has to be in place before the anybody chooses to change their behavior is? Would someone like me do this? And there’s that defining of what someone like me is.

David:

Yeah, it’s so important. You know, I think it’s Seth Godin’s book. People like us do things like this. I think that’s how you build a tribe. And I found that to be I would wear that T shirt.

Rudy Fernandez 8:21

So I’m guessing Retail Voodoo gets called in when they drop to one of many and are looking for a solution? Is that is that accurate?

David Lemley 8:30

I think that’s accurate. There are two times and people bring us in. And one is when they realize they have an amazing idea. And they have an innovation pipeline in front of them and they feel like they want to press the gas to go out and become that thing that everyone else chases. The other time, which is at least half of the time is when they are on the verge of getting disrupted.

Rudy Fernandez 8:52

One of the things you put on your book is that it takes more than a founder’s passion to grow a brand and I can see that especially with these brands. I’m guessing there’s a lot of inspiration behind creating something that the world needs. Can you expand on that on why founder’s passion isn’t enough to grow our brand?

David Lemley 9:08

I think to be fair to start, I think any of these brands across our modern life, have that sort of founder’s passion driving in, and examples would be, you know, Zuckerberg or Jobs or Besos. There’s definitely a founder’s passion underscoring that. And then if you think of smaller brands, you think of any microbreweries or any brands like that. It’s usually driven by an ideology that stems from the human, his idea was to make that brand. And what we have found is that those people tend to be really charismatic, super jacked up about what they’re doing and can sell anything to anyone as long as they’re in the room. Yeah. When you reach a point where there are 12 founders saying the same thing or 12 founders plus three, well organized, highly funded multinationals that are playing in the space, that founder may not get in the room. And therefore, that passion is not transferable. So that’s where brand story and ideology and guiding principles come into play and to write them down and to share them through our culture is really critical in order to be able to have the brand extend beyond the individual.

Rudy Fernandez 10:23

Yes, funny, I just read Sapiens, which is all about the reason homosapiens set themselves apart is their ability to tell a story and enable mass cooperation. And it’s similar what you said, the story has to go beyond the founder. Has to extend to people who’ve never met the founder.

David Lemley 10:42

Yeah, it’s really important and it’s so interesting that you bring that up the way Sapiens are hard wired for story. Its inherent goes all the way back to cave paintings. It’s really how people did create groups, or tribes and align around an ideology and get stuff done. And I think that’s kind of the power of storytelling within brand today.

Rudy Fernandez 11:07

Well, how do you get them there? Because in your book, you have a well thought out process on branding. But yet you are in the retail world. And we all know retail, it’s it’s a bottom line, how many units to do sell. So how do you get companies that are focused on today’s sales focus on longer term branding?

David Lemley 11:26

Well, the first thing we usually say is, if you are talking to us right now to help whatever the bottom line up days, it’s too late. So you have to get beyond the season you’re in and start to think about it as you’re cultivating an ideology. And you start to think in terms of contribution and legacy and really hone that in and if the organization is not ready to talk like that, then they’re probably going to be sales driven rather than brand driven. Another way I think of that is they might be opportunistic, rather than Strategic, oh well can sell this create load of coffee this quarter. And that will carry over all of our financial needs for the next 120 days, rather than thinking about what we could do to make it so that we’re the only ones selling that kind of coffee or we’re the only ones who people think of when they pined for that kind of coffee over the next 10 years. And so it’s a completely different way of thinking about it, and with prospects about this idea of competitive advantage, unfair share of market and being able to command the price that you need in order to afford your values. And when you start talking like that people start paying a little bit of different attention, then, what are we going to sell next quarter?

Rudy Fernandez 12:46

How much you need in order to fund your values – is what you said?

David Lemley 12:50

Yeah, in order to be able to afford your values.

Rudy Fernandez 12:52

That’s great. That’s wonderful. Now in the foundation of the book is a brand ecosystem. process that you’ve put together. And it’s quite brilliant. Can you walk us through sort of that and then have a few questions about it once you walk through the system itself?

David Lemley 13:10

Sure. Well, so to start with the system, this brand ecosystem comes from me hacking. Chet Holmes is 7 Musts of Marketing. So Chet Holmes wrote the Ultimate Sales Machine book that is 20th century book, but he was the super guru of selling and marketing and using sales and marketing as an integrated vocabulary. And so I got to see and learn about that early on and was really empowered by it in terms of running this consultancy my agency. And so over the course of time, I started hacking and saying, Well, what can we do to use this for clients? How can we integrate this into brand and so we modernize it again, using the notion that we’re constantly hacking it, updating of the technology or whatever tools are in it. So today it reads like this. Imagine a pyramid in your head. And the base layer is customer education. Because if you can’t teach them why they should, or could or might be involved in your ideology, and what, what sort of products and features and benefits and what sort of citizenship they get to have in your brand, then there you’re always going to be competing on price. So that’s the foundation. And then the next layer is really public relations. But public relations is not like our father’s public relations. It’s really authenticity relations or earned storytelling, third party validated storytelling. Yeah. Then from there, we get into advertising are what I call conventional or known outreach. There’s a whole bunch to talk about their potency of advertising or why there’s, despite, you know, theories of a isn’t post relevant, and yet there’s so much powerful storytelling happening in advertising that it that is amazingly sticky. The next layer is your in store, which is not just like what you’re sticking on the shelf, whether you are trying to get a product on a shelf, or whether you own the box and you are curating what goes on the shelf. It’s really about the relationship that happens there not just with consumers, but with the retail buyer and with your adjacent competitors, or your share of stomach or share of entertainment, or whatever else is going on within that space that you’re playing with. And that could be physical or could be digital, all of that lives in that. And then the next layer up is your web properties, how they play, what sort of stories you’re telling there and what level of engagement you’re offering there. And again, that could be a whole other 500 question topic there.

Rudy Fernandez 15:53

That’s an evolving -they’re all evolving pieces.

David Lemley 15:56

That’s why I say we’re constantly hacking this because the ability to upgrade it happens probably on a weekly basis around here from website, then you go into direct, which is not just old school direct, but it’s all in your interaction with people when they’ve given you permission to communicate with them once they are in your tribe, and they’ve opted into your world. What kind of communication do you have with them? Yeah. And it should be more than couponing and more than providing offering them a deal. And then last from that, it the top piece of our pyramid is social, which we put it on top, because it’s the crowning jewel, but it’s also the thing that most brands get wrong.

Rudy Fernandez 16:35

Yeah, yeah. And probably the thing that’s most out of your control. Then social, you have that danger of people saying things you may not be consistent with the brand you’re trying to communicate.

David Lemley 16:48

Yeah, that’s so true. You know, it’s really interesting as I talk about that, that ecosystem or that pyramid shaped ecosystem, that I’m reminded again, of what Ed Farley said on your show, a couple of episodes ago. He said, it’s the tip of the iceberg. And the reason I think that that resonated with me is that’s exactly how we talk about it here. We talked about that top piece is the tip of the iceberg. And getting stuff underneath that is the harder soulful or long term thinking or cultural or what kind of contribution you’re going to make. All of those kind of need to be in place in the form of your Why, and contribution in order to know how to use those other tactics.

Rudy Fernandez 17:30

David, you mentioned advertising and it is, oddly enough a complicated subject because it has changed as you point on your book you no longer have what was pretty much captive audience in the past. I think you pointed out as well, people actually paid to not see ads. One of our guests once said, People don’t hate bad ads. They hate bad experiences.

David Lemley 17:51

Exactly. And so from that, so that reminds me of Joe Pine, the super godfather of the experience economy, and he says they don’t like to be in interrupted with bad experiences, they want immersive experiences. And so if they know about your brand, or they have some relationship with it, or there’s some ideology or emotion or human tribal thing that you can connect with them, then they will invite it in, rather than feel like it’s an interruption. Think about it like this. So if you have an ideology that is cause based or is something I’m going to use Nike, as an example. The Nike brand, why is it that all of their advertising gets so much buzz and so much shareability and creates so much controversy? It’s because they are always mapping back to who they are as a citizen in the world, what their organization stands for what their ethos is, and they make it really crystal clear what they’re willing to take a punch for. And when you do that, and people can trace it to the cause of what you’re willing to do with your profits. It becomes FinTech, it becomes something that people want to share. And they want that badge. Well, the badges you get to be a contemporary socially aware, you get to be somebody who stands against poverty and racism and stands for equality and believes in victory for all. So that is a really powerful, heady thing to get in.

Rudy Fernandez 19:21

Actually, you brought up a great point because so many of the people with whom I’ve spoken, talk about how your brand now belongs in part to your audience, which would imply that other people decide who you are. But there’s always a balance to that because you can’t let other people decide who you are. Nike is a great example. They decide who they are, and more importantly, who they’re not. And they got a lot of bad press for some of the stuff they do, but their advocates and their fans are even greater than they were before.

David Lemley 19:50

Exactly. So I think that consumers have assumed control over the influence of your brand. But if they are the ones deciding what your morals and values are, and what your products are, you will be dead within 10 years.

Rudy:

I love that.

David:

Yeah. So if you need if you don’t know what your morals and values are and what you’re willing to stand behind no matter what, then you will become a commodity.

Rudy Fernandez 20:17

Yeah. Good point. How long does that process take to walk with a brand new client through that,

David Lemley 20:28

if you’re starting at the beginning, it takes about four to five months to get from are hanging out talking about what the opportunities are to, okay, we have a strategy in place and we have a new product pipeline or a new audience to be map or a new retail strategy, whatever it’s going to be in play and some creative translation to go with that. That’s four to five months, and then the execution of the ecosystem could be weeks to months to years, depending on how complex It is and what they need stated the client is.

Rudy Fernandez 21:03

Here’s the challenge I have often when you start to walk a client through a process. There is a bit of impatience there. And there are some stakeholders who are saying it’s going to take how long and Can’t we just get whatever I needed this for my next meeting. Do you run into that?

David Lemley 21:20

Oh, yeah, we run into that frequently. And it really depends on who you’re talking to in the client. You can’t actually be in, in business in this creative consulting or agency world and not be a good servant leader. You know, you have to take care of them and meet them wherever they are in the process and meet their needs. I think it’s really important to be able to say, okay, we can help you with that thing you need or we understand that compelling event or deadline that you’re facing. And we can handle it this way or this way or this way. But that this core strategy thing, it will not be done in time to fix that. That goes back to what how we sort of started this conversation, which is, how do you get them to think about long term and they have a short term need or a short term pain point or a short term goal? Yeah. And when you can paint a picture of a future where they’re not having to sweat blood becomes compelling.

Rudy Fernandez 22:17

I think you need to teach a class to me on that. I love the name of your company, by the way that Retail Voodoo because it tips it’s hat to there’s still a little bit of magic that goes into this. There’s an abundance of data available that people rely on. But it’s part science, part art. One of your quotes in the book is competitive research isn’t an academic exercise, which I love that thought because every step of the process requires human creativity and insight. And the data by itself is not going to provide that.

David Lemley 22:50

Absolutely right. That’s exactly what I’m calling is that without creativity and human insight and people hanging out and talking about it, and our arguing over it and coming to some distillation of it. All you have is a ton of information that will drown you.

Rudy Fernandez 23:07

I’ve seen a lot of company’s different processes, but yours I really liked because it had a lot of down to earth stuff in it. It incorporates tactics as your part of your plan – you have PR and advertising and social and website and all those things. Do you think that’s because of retail bent, they realize I’ve got to have some more tangible things?

David Lemley 23:28

I think it’s a response to the way marketing has evolved. I think it’s a response to how humans behave today. And how brands which are more sophisticated than ever need to kind of come down from the top of the mountain and behave like a citizen.

Rudy Fernandez 23:47

Yeah, that’s great. I’ve seen both either there. They’re all into tactics or they spend too much time. You know, with navel gazing.

David Lemley 23:56

Yes, agreed. When a company comes in and says, Well, you know, we are We need a strategy. But we want to be done with that like Thursday. Campaign launching And oh, by the way, can you fix all this? It doesn’t work that way.

Rudy Fernandez 24:11

I’ve had those conversations. What made you decide to do a book?

David Lemley 24:18

I wrote the book over the end of 2018, and into the first seven months of 2019. And I did it in direct response to kind of what we’re talking about the beginning, this idea of Better for You is really moving to this, the center of people’s awareness. And two things I wanted to sort of democratize the thinking, get it out there so that people who are out there who wants to make the world better have some tools and some questions that will cause introspection so that everybody does better at this. And my thinking as that because Better for You and food and beverage and wellness and fitness have become popular. And the investors and marketers who used to do technology are used to finance or you are Silicon Valley thinkers are in this space now that they needed a new toolbox. And so I put the toolbox forward so that they would at least be a common language so that an investor knows how to talk to a founder, knows how to talk to an agency, talk to a bank, so that everybody can kind of say, that’s what we need to do.

Rudy Fernandez 25:26

That’s a great idea. It’s a great motivator and a tool. This is a brand new category. I always ask our guests of all the changes in the marketing world. What are you most excited about? And what are you most concerned about?

David Lemley 25:40

What excites me the most is that consumers and humans are open to new things. And instead of it being so much like Henry Ford, you can have any color as long as it’s black, you know, that’s the thing I want. I want a computer in my pocket. I want my phone you know, iPhone store. I think people are dialed into innovation. And it’s starting to realize that, that it’s the rehabilitation of science, science and technology can actually make people healthier, and live longer and create cleaner food, create more sustainability. I think that’s really exciting to me that they’re open. And marketers have so much opportunity, communicate with them quickly and efficiently to create tribes in a way that has never happened before. Yeah, it concerns me the most about it is actually, again, going down this idea of accessibility and social channels and digital channels. I’m actually a little bit concerned about young people and phone screen addiction and depression. So yeah, to me is something that as, as marketers, if we can actually contribute to the solution of get them to look up and talk to other people or get them Go out and go for a walk would be.

Rudy Fernandez 27:03

Let’s do it. I’ll help you. How do we do that?

David Lemley 27:06

That’s another conversation but creating causes that get you away from the screen I think are all about re instituting the flashmob.

Rudy Fernandez 27:16

Thank you very much. It’s been great, David. I really ever enjoyed this and I’ve enjoyed the book very much. I appreciate you sending that to me.

David Lemley 27:22

Thank you for having me, Rudy. It’s been really great, fast paced conversation and I can’t wait to talk again in the future and compare notes.

Rudy Fernandez 27:31

Thanks for listening to Marketing Upheaval from Creative Outhouse. If you want to learn more about Retail Voodoo or for a copy of David’s book, is at Retail-Voodoo.com. You’ll see a link to his book on the homepage. If you want a transcript for this episode, or want to hear previous episodes, visit www.CreativeOuthouse.com/podcast. If you liked this podcast, give us five stars. Subscribe and share it with your friends. Why not? Our producer is Susan Cooper and if you live in Atlanta, check out Susan’s new podcast, Dinner Tonight Atlanta a micro podcast that tells you where to eat in Atlanta every night. It’s pretty cool. Well, that’s it for this episode of Marketing Upheaval. And remember if the current state of marketing has got you confused, don’t worry. It’ll all change. See ya.

Podcast credits:

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