EP56 - Rick Cesari - Five Keys to Building a Great Brand

Five Keys to Building a Great Brand

On today’s part two of a two-part episode series, we are reintroduced to Rick Cesari, a pioneer in the Direct Response advertising industry. Rick has helped take companies like GoPro from a start-up to over a billion dollars in sales in just a few short years. Rick is also a best-selling author, speaker and consultant and a brand strategy guru. Here are more gold nuggets on today’s episode:

• Why every brand infomercial should start with the brand logo.

• Diversification - promoting your brand in different markets not just on TV or online, but also in lower level markets such as state fairs and trade shows.

• How to distribute your brand in different channels and let consumers buy your products where they want to purchase them.

So, sit back and listen to know more about brand response strategies from Rick Cesari and build your business like a billion dollar brand.

5:28 (Rick talks about his experience working with GoPro.)

13:38 (Ricks tells us every GoPro spot starts with a brand logo.)

29:06 (Rick gives examples of tipping points related to GoPro.)

36:54 (Rick tells us how OxiClean became one of the big brand names that everybody knows today.)

56:03 (Rick talks about his first book, Buy Now .)

58:22 (How listeners can download the Five Keys to Building a Great Brand at rickcesari.com .)

Welcome to the Awesomers.com podcast. If you love to learn and if you're motivated to expand your mind and heck if you desire to break through those traditional paradigms and find your own version of success, you are in the right place. Awesomers around the world are on a journey to improve their lives and the lives of those around them. We believe in paying it forward and we fundamentally try to live up to the great Zig Ziglar quote where he said, "You can have everything in your life you want if you help enough other people get what they want." It doesn't matter where you came from. It only matters where you're going. My name is Steve Simonson and I hope you will join me on this Awesomer journey.

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You're listening to the Awesomers podcast.

Steve: This is Episode Number 56 of the Awesomers.com podcast series and the insiders already know that all you have to do is go to Awesomers.com/56 to get today’s show notes, details, summary, even a link or two that we throw in there from time to time, all of that details waiting for you at Awesomers.com/56 . Now today Rick Cesari is coming back to us for Part 2 of this two-part series where we've been talking about how you can build a billion dollar brand. Now, I want to reinforce Rick’s book just dropped yesterday and today it's available for you as well. Go find the book and we'll put the links on the website as well. You can go to Awesomers.com/56 to find the links, but we're going to buy his book because we want to learn how to build billion dollar brands and we're going to leave a review about his book because we're good people and we pay it forward and we understand when valuable content like this is delivered we're going to do the right thing.

Now, just a little bit about Rick’s background in case you didn’t join us in Part 1. He’s helped major brands like GoPro, George Foreman Grill, the Juiceman and many more built into massive massive well-known brands. I don’t think there's anybody in the America that you can go to and say you know have you ever heard of George Foreman Grill and then say no. I'd certainly think even worldwide, the GoPro has become a phenomenon. In today’s episode, we talk about the GoPro origin story and the OxiClean origin story and you know really how these iconic brands were developed. In fact, Rick takes us back to the very beginning of GoPro when he found and met the founder at a trade show, kind of been a VW minivan with kind of surfer vibe and how that has built and created a life and a brand that has taken on a life of its own to be honest. So, it's a really extraordinary opportunity to learn from somebody who’s you know been doing direct response advertising for so many years and it's a great privilege to have him come on two times in a row. So, this is Part 2 of our two-part series and I know you're going to love it and I know that you're probably going to share this, you're probably going to like it and you probably even going to leave a review for Awesomers.com right. I know you wouldn’t disappoint me. I look forward to reading your review online soon.

Hey Awesomers, welcome back. Steve Simonson joining you again here on the Awesomers.com podcast and this is Part 2 of our visit with Rick Cesari.

Rick: Cesari.

Steve: Dang, I knew it. I was a 50-50 guy.

Rick: No. That’s the same mistake everyone makes.

Steve: I swear to goodness that you know I really do study. I try. I try, but I fail. I try and I fail, so my apologies to Rick as usual because I get that wrong every time and I could have gone back and listened to the tape. I'm like no, I'm pretty sure that you know – anyway, so obviously I'm wrong yet again. So, Rick we've had a wonderful discussion in our last episode about some of your origin and some of your background and diving deep into the Sonicare story and learning all about the Taco Machine that used to exist that became the world famous George Foreman Grill. It had nothing to do with making tacos at the end of the day. But today, I wanted to kind of have you refreshing us up on we're talk a little bit about your book which is Billion Dollar Brands.

Rick: Yes, Building Billion Dollar Brands .

Steve: Building Billion Dollar Brands and we'll make sure we have links to the book in the show notes everybody. And by the way, because Awesomers are pay it forward people, when we buy this book and we read this book, what's the next thing we do? We review this book and we leave those reviews on Amazon because we're good people. So, we're going to get that done and, but in addition talk about the book and kind of the genesis for it and you know – spoiler alert, it's probably related to your experience, but we're going to talk about GoPro and OxiClean today because those are a couple you know other, just a couple of other examples. You know, we've already – we kind of skipped over Juiceman which is another world famous brand.

Rick Yes, yes.

Steve: But yes we're going to start and stop somewhere. So, let's talk about GoPro a little bit. What's your experience and how did you get into that one Rick?

5:28 (Rick talks about his experience working with GoPro.)

Rick: Well, GoPro is a really interesting story. You know, I'm still – if your listeners remember from Part 1, I own a direct or had a direct response marketing agency, direct to consumer marketing agency and you know we get a lot of new business from referrals, people seeking us out because of the previous successes, but also one of things I do just personally is I'll go to certain trade shows and just walk the floor and look for what I think are good products, good company, something that you know interest me personally. So, I was down at the outdoor retailers trade show in Salt Lake City and walking the floor and I came across this booth. It really wasn’t a normal trade show booth. The founder of the company Nick Woodman had driven his Volkswagen bus on to the trade show floor and he later told me he did that because he couldn’t afford to buy a booth and basically you know it's kind of an iconic symbol of a surfer from the movie Endless Summer. And basically he had set up a surf scene with the Volkswagen bus. He had some sand, some lounge chairs, but the product he was selling, he was selling this little camera out of the back of the bus and he had a crowd around him. And for me, that’s always the first indication of a product that potentially can be successful is you see a lot of people, you wonder what the excitement is and they were excited about this little camera that Nick had produced, which at the time was the GoPro camera. So, we had a short conversation, but he was really busy and I said, “You know, I'd love to talk to you further about this” and I guess he was interested in talking further because two weeks after the show, he flew to Seattle and we sat down and talked about his vision for the business. It was funny I remember we went out to a little restaurant. You're from Seattle Steve, so you know a restaurant on South Lake Union and also your listeners. that’s where Amazon is located now, but this was probably Amazon was still in its younger days at the time. But anyway, we – I remember he ordered a beer and chili cheese fries. That’s what he had for lunch and we–

Steve: So, he’s a health nut just to be clear.

Rick: Yes, exactly.

Steve: That’s it? Okay, good. I'm just making sure the listeners at home are paying close attention. Carry on.

Rick: So we proceeded to talk about his really his vision for the business and how we could help him, but it was really clear that he was passionate about what he was doing and he had talked at this initial meeting we had that his goal was to build a billion dollar business and you know you'll never get to a certain point unless you actually set a goal or visualize doing it and sometimes the goals can be really big and in this case they were, but I remember we talked about a lot of the steps that the company actually followed over the next eight years to get to that threshold. And you know, again, I mentioned I think in the first interview that we did, the first part of the interview, sometimes you have the right product at the right time at the right place and the GoPro camera was another situation like that from the standpoint of it was riding the wave of the selfie boom where people were turning their cameras around and taking photos of themselves. And GoPros are good cameras, but if you think about the competition, you know Sony, Panasonic, all the big camera companies could have had this technology or created the same technology, but what Nick did was really a very you know simple, but genius type of thing. He developed the mounts where you could – if you were extreme athlete or any type of athlete where you could mount it on a helmet, the front of surfboard, a ski pole, a mountain bike and you could turn the camera around and take pictures of yourself and the product just exploded. I'm sure almost all of your listeners have heard or seen a GoPro. You can't really go anywhere on a ski slope or snowboarding slope without seeing them.

Steve: Yes. If Awesomers out there don’t know the GoPro story, we're going to vote you off the island because it's – you don’t have to know the story, but you certainly know the product and I want to reinforce one of the points that Rick has made and maybe even unpack a couple of little lessons that I picked up along the way. First of all, Rick as we talked about in many episodes, he was out there networking. He was out at their trade shows. He was putting himself out there to see what's what right.

Rick: Absolutely.

Steve: And here’s his world class brand that we all know today and we know that it has passed that you know billion dollars threshold, but you know they started just like a lot of us right and just a little you know we couldn’t afford a boost so we just kind of had to fake our way until we make our way and that’s what the founder did, but they struck up a conversation and that’s now both people are saying all right, what are the possibilities? How do I leverage – his experience, how do I leverage that product? But the biggest part to me and Rick really talked about this very well, it's just a camera right. There's a million other people that have cameras. He took that camera and he made it something special with all the mounts, with all of the applications and kind of made it like hey, if you are cool and if you're going to be out there surfing, if you're going to be out there snowboarding down a mountain, there's only one choice. You're not going to go to Sony or Panasonic or Nikon, you're going to go to GoPro and that’s it and their little tagline Be a Hero is so perfect because everybody – anytime they read or watch a movie right, you read a great story, watch a movie, you always visualize yourself as a hero so–

Rick: Absolutely. And basically–

Steve: The whole thing was – yes.

Rick: Yes, I'd love to go into – let's go into a little bit more detail because it kind of ties together old school basic direct response marketing techniques with new school technology and you know behind the scenes look at the some of the success with GoPro, but you were absolutely right. I was about to bring up the tagline Be a Hero and from an emotional attachment, everybody wants to be a hero. And one of the things I did – let's talk about marketing, and they used influencers. In the old days – let's go back to Sonicare toothbrush, we call them key opinion leaders and we got the top dentists, the top periodontists in the country to endorse our product bringing credibility to it. So Nick had an action camera. The influencers he got were the top surfers, the top mountain bikers, all the top extreme athletes and he gave them free cameras. That’s another important point that if you want to get people talking about your product, I always am a big believer in giving them away for free whatever the product is, getting to the right people, getting people to talk about them and again you're expanding the awareness of the product. So Nick did that and got a lot of extreme athletes using the cameras. So, the second thing that happened is everyone likes to take pictures of themselves, post them online and what Nick did, people would do that to their own followings, but then he also – the GoPro site was a place where you could go to see all these cool videos and then people come there and share them and you know that’s one of the you know foundational reasons that the product took off, but from a marketing perspective we did something where we tied old school thinking into kind of a little bit of new school. We never created long infomercials for this. Every GoPro spot was 30 seconds and we had a specific format that we used that did a couple of things and I recommend when people are making videos. I think we might have mentioned this before.

13:38 (Ricks tells us every GoPro spot starts with a brand logo.)

Every GoPro spot starts with a brand logo. So immediately you know when you're watching a GoPro spot what the commercial is about and you know if you turn on TV, if any of your listeners still watch TV, you see a commercial half the time, you don’t know what the heck they're talking about until it's over. So right away with the brand logo upfront you know it's a GoPro spot then in the middle like an Oreo cookie user-generated footage and then at the end – and this is where the direct response came in, basically we said at the end of every spot we said, “Go to our website which is the gopro.com and register for our contest. Someone will win one of everything we make every single day.” So what that did was you were giving people a reason to go to the site. So, number one, you're driving new traffic to the site. People would go to the site, see those cool videos, share them with their friends creating a little bit of a viral marketing effect. The second thing that happened because you had to register for the contest and win cool GoPro stuff, we were collecting email addresses and creating a database where we could remarket the product to people, get them to buy it, you know basic E-commerce. And then the third thing, by driving people to the site, some people just made the decision to buy the camera. So, we were generating revenue at the same time, but it was really a basic direct response technique at the end of what would be considered kind of a normal commercial although the GoPro commercials were pretty cool in themselves, but again it's that utilizing those concepts in a little bit different way to create the success of the product.

Steve: It is really a nice adaptation to be able to kind of tie in – you know, nirvana is  user-generated content by the way everybody. You know, that’s – Facebook loves user-generated content. Their whole business is built around it. They produce almost nothing yet their site is filled daily right. YouTube is the same way, user-generated content. So, GoPro you know took this concept of hey, everybody is liking you know these beautiful videos and some of them are quite spectacular. That’s the part where I think the GoPro founder is so brilliant is you know he got these angles that were so unique nobody ever really contemplated you know having the actual thing on the surfboard itself you know or if they did it certainly wasn’t popularized and he was able to lead that popularization and now when you see some of these videos whether they're snowboarders or surfers or even just people running or mountain biking it's just pretty amazing and people get enthusiastic about it, so that energy seems to be imparted to the brand halo to some extent.

Rick: Right. So let's just dive a little bit deeper again from a strategy standpoint just to show you how they built this into a billion dollar business. So their niche are the niche that they dominated and became the cool product or the brand was extreme athletes and then people wanting to be like the extreme athletes, but if you think about it that’s a fairly small niche in the mass consumer market so at some point GoPro needed to expand out of there and it's a very definitive. We started you know all of the early spots that we were helping them make where you know the extreme athletes then you'll see a transition and you'll start to see people using it to film their pets. And one of my favorite videos is of a French bulldog on the beach and it's just you know that beautiful footage and watching it go around and you're implanting the idea in people’s minds hey, I can use this camera for more than just extreme athlete. And then there's a family picture of a family riding down a hill in their backyard in a toboggan and really really cool videos, but really expanding the marketplace from extreme athletes to a much larger audience. But again, you know we talked in the first part of the interview about positioning and how – and it's important to find a category regardless of how big or small it is that you feel your product or service can dominate, well GoPro came out and dominated the extreme athlete, dominated that category and then they were able to expand outside of that.

Steve: Yes. It is really – it's brilliant marketing, number one, but it's also you know a way to not just reach the mass market, but a way to you know kind of show people hey, this is how you use it right. It starts with the extreme athletes and you get that credibility and that you know anybody you know, kind of again they visualize themselves as a hero. I can do that extreme snowboarding if I really wanted to right and it's like no, not a chance. I you know get a little dizzy going down a slide at the kids’ park. So, but then taking the dog and taking the family and taking these other applications people then can see themselves you know using that camera on a day-to-day basis and you know I know for myself I bought my son one of their cameras. It was probably at least $400 or $500 and I probably bought them another $100 worth of accessories that he could you know – I don’t even – I'm not sure he’s ever actually used a camera if you want to know the truth, but I thought it was cool enough and that it will give him the chance to go edit and all of those messages that you guys were – you know, engineering way back in the day still work you know even on these recent years. So, what did you guys kind of do next? Where did the–

Rick: The two – yes, two things I want to just mention, you mentioned accessories. I remember watching an episode of Shark Tank and there was a company that was doing nothing but selling GoPro accessories and making $8 million a year and I think they were doing selling primarily on Amazon and they were looking for money to fund their business. So here's a very successful company doing nothing but you know piggybacking on the success of GoPro just on the accessory area. But you know this is a great next step because where GoPro really made the switch from one like $100 million to a billion which is 10 times the size and I've heard you – you know, first Steve first you alluded to it in the Mastermind group when we first met, the Catalyst88 Mastermind group, about the brick and mortar mass market consumer and that’s really where the tremendous of GoPro came in. So, they had this great foundation of direct to consumer marketing as a very profitable business, but they wanted to get out everywhere and so they basically had a trial with Best Buy and Best Buy was located – I think at the time we were doing this, I don’t know if the number is still correct, they had like 1,000 stores across the country and a lot of times a big store like that will do a regional test and they’ll basically put you in a few stores. If they do it well, they’ll do the whole chain. And so Best Buy headquarters just like Target headquarters is in Minneapolis and so one of the things when the test started is we blanketed the Minneapolis TV market with GoPro ads so that the executives would be seeing that and it's just a little thing, but I've done this before with Walmart and it's very inexpensive to buy time in Arkansas and Minneapolis to get enough exposure to make an impression on the executives of those stores. But anyway, their growth really happened when they got into the brick and mortar and so it goes back to now when I talk to companies about an approach to building a big company or building a billion dollar company. Let's just say you want to build a $10 million company, I will say there's like three legs to the school and Amazon is one leg obviously. You need to establish and be successful there. E-commerce and your online presence, which include your social media and you know your direct to consumers sales from your website and your content on your website is the other leg. And then the third leg for me at least still for certain products is being able to have a successful direct response TV campaign if your company is bigger, but you can also supplant that. We talked earlier about doing a successful Facebook campaign or whatever. As long as you have some type of engine where you're getting a return and you can put those odd dollars back into the engine that kind of drives the awareness and it's kind of a simple model that a lot of companies could execute on, but one thing I find with a lot of the people that are doing Amazon only, it's like Amazon is the be all, end all and they're missing out on a lot of business and also they're missing out on a way of protecting themselves I feel should something change on the Amazon so.

Steve: Well, this is a very important point and I appreciate you kind of shining the light on it. So, the first thing is you know I have a number of axioms. I call them axioms, it's because I'm a marketer at heart and otherwise it would just be the crazy old man in the corner who keeps repeating himself. So now it's a good thing right, they're axioms.

Rick: It's a rule or an axiom or a secret.

Steve: Yes, that’s right, yes. That’s right. So, one of the axioms is in my opinion and these are self-generated so they could be wrong, but you cannot have a world class brand in a single channel. Now, it doesn’t mean you can't have a world class product or a great business that builds equity, but a true world class brand that exist across multiple channels and for the reasons what you kind of you know alluded to slightly is you know there's diversification matters, not just to reach your customers, but for the risk profile.

Rick: Absolutely.

Steve: You know, one of my brand I bought about a year ago, Amazon just has wiped every review that product ever had.

Rick: Yes.

Steve: Now, do I think it's fair? No. I don’t particularly think it's fair. Amazon has their reasons and you know we can fight about it and so forth and I have no problem with how great Amazon is a marketplace opportunity, that’s the you know the upside to it, but there's also risk and that product could be a dead duck now. I mean I may just have to fold up that company because starting from scratch to get new reviews and you know who knows even that process how long it will take, it's a daunting task. So that’s a big risk and you know I've made luckily plenty of money since buying that company and it's more to monetize itself probably 5 or 10 times over in just a year. It's–

Rick: Right.

Steve: – been okay for me, but it's relatively small. But the point is there is a risk on being in a single channel and you don’t know what's going to happen. So, for that reason, that’s a good reason to consider – diversification, but for the other reason of reaching a larger market, that’s another equally good reason and as you said I think very eloquently you can start out with you know a reasonable budget. You don’t have to start out with a million bucks on nationwide you know kind of infomercials on TV, webinars.

Rick: Right.

Steve: You can start with you know Facebook or doing your own, your kind of webinar series and so the other axiom that this finally ties into is you know you have to be able to pour money in the top of the funnel and have profit come out at the bottom of the funnel to have a sustainable business, to have a true business. That’s how it works. You have to pour money in the top of the funnel and it has to produce profit out of the bottom of the funnel on a predictable basis, that’s when you have something that could scale. What do you think about those axioms Rick?

Rick: I 100% agree with everything you're saying and I like the fact that you're boiling it down to this really simple concept as far as putting money in the top of the funnel and then getting it out at the bottom and really that acquaints to what I mentioned before about the advertising. If in us there's different rules, but if we spend a dollar on advertising we need to see a minimum return of $2 and sometimes that’s just to break even, otherwise that advertising channel isn't working for us. And so again, it's that analogy. The money goes into the top. You put a $1 in. You want to get $2 or more out at the bottom. The more you get out of, the bigger and faster you can build the business, so absolutely agree with it. And the other one that ties into what you said, there's lots of reasons for the diversification. The last one I want to just add to that is that I'm a big believer at another simple concept. Let the consumer buy the product where they want to purchase the product. And I know when you're a young business you can't be everywhere and available to everyone, but once you’ve successfully mastered one channel, start looking at some other channels because you can't control consumer behavior and the way you become this billion dollar company or big brand that’s well-known is really that your product is everywhere or everywhere that the consumer wants to purchase it because people have different shopping habits and I think you’ve mentioned this before Steve that Amazon as big as it is is a small percentage of the total amount of revenue where people are purchasing.

Steve: Totally right, yes and that’s – you know, I really appreciate the fact that you drive this point home. And you know as marketers or as brands our obligation is make it easy on our customers to the greatest extent we can right. There's some people you know they buy their product at you know whatever, Target. That’s just what they do. That’s their shopping habits and it doesn’t mean they never have been on Amazon or they’ve never bought anything online, but if they're – if that’s where they shop and you're not in Target, you may never get a shot of that customer period. That’s just the way things are and so I really do appreciate and agree with that. So, we're going to take a quick break. When we come back, I want you to think about you know any stories or any anecdotes you care to share about that tipping point with GoPro and then we're also going to talk about OxiClean and we're going to do all that right after this break.

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Steve: Okay gang, we're back again. Steve Simonson joined by Rick Cesari – what do you think?

Rick: Got it right Steve.

Steve: Hoo-hoo! Well, you know 50% on the day and you know good Lord, if I have to pronounce it again, it could go either way. So anyway, Rick, before the break I teased this idea of any tipping point or anecdotes related to GoPro that may be interesting to the Awesomers out there because there's so many little phases a company goes through and so many moments, defining moments if you will that companies go through I'm just curious if any stand out to you.

29:06 (Rick gives examples of tipping points related to GoPro.)

Rick: Yes. I have an example. It's a little bit higher level from the standpoint of the company was doing quite a bit of revenue when this happened, but we talked before about getting the distribution in Best Buy and that happened in the fall. I forget the exact year. But you know the fall for brick and mortar stores is that you know, they could do two-thirds of their sales in the fourth quarter and so they were able to get that distribution to all the Best Buy stores in the fall quarter and one of the things that kind of put things over the top – and this is funny because in the TV it's kind of like the Holy Grail, like okay let's run a Super Bowl ad and 90% of the people that run Super Bowl ads or companies that run them do them – it's an ego-driven thing and again, from a direct response marketer it's not a good place to run ads, but we again approach things a little bit differently from a marketing perspective. There's no way you could pay $3 million for one 30-second Super Bowl ad and get it to pay off. And again, I'm using the mentality of a two-to-one return minimum, but what we're able to do is go in and do something what they call local placement. So, we took the top probably 10 markets in the country and you can buy what they call local insertion. So, we spent a fraction –. I don’t know if the Super Bowl ads were running like $3 million for 30 seconds at the time, we were able for a couple hundred thousand dollars to get about 80% of the same audience and when you know that happened we did the same thing with the Olympics. If you go and buy network time, it's really really expensive and then here's another – and so that was kind of a tipping point to really kind of ingrain it as this big you know national brand, that type of thing and then the other little key and again, this is a little bit TV-oriented and but one of the aspects of doing direct response advertising versus the brand advertising you mentioned before is brand advertisers pay rate card or the most expensive rates and I'll give you an example. If you're Procter & Gamble and you want to be in Good Morning America, you're in Good Morning America, you know your spot is going to run at 8:30 in the morning. So, if we want that audience, that same audience, we'll go Good Morning America and say we want a direct response rate. We want to air anytime between 7:00 and 9:00 A.M. We don’t care when that is and we get the time from 20 to 40% less than the big brands paying for it. So, it's kind of like a little bit of specialized guerilla marketing that helped really implant the GoPro commercials in people’s minds.

Steve: Oh, I just love that scrappy mentality right. Even as the company is growing and has tens of millions, even hundreds of millions in sales, by taking that scrappy mentality of hey, how do we get more, how do we get more for less. That’s you know another axiom by the way and this premise that you know you can have some large exposure whether it's the Super Bowl or at Good Morning America or Olympics and doing it strategically that just goes to show that knowledge and experience really has extraordinary value. I love those kind of stories and I think every Awesomer can understand the potential impact for it and really start to do that math that you know what, it's not unreasonable to expect you know to use television in some way in the future. There's lots of different ways to do it and we can talk about the variations to that. So, I really love GoPro as a brand. You know, they – obviously, they’ve gone public and they’ve had their ups and downs with sales and growth and this and that, but the product itself is wonderful. The brand is wonderful. The marketing was masterful. How did the founder cope with all this? Did the founder stay in place the whole time or you know this kind of growth can be pretty exciting.

Rick: Well, yes, you know, this is again and it's really interesting there's lots of fun stuff from a marketing perspective talking about how these companies grow, become brands, but you also get a really good glimpse into the management, which is the other side of creating a successful business. If you don’t have good management systems in place, good people in place, you're never going to be able to get over a certain level and you know this from running businesses. So, it's another thing that’s very important. So, kind of going back to GoPro, two things happened and Amazon ties into it. With any product no matter how successful the brand, that gives you a lot of protection because people seek out the brand, you can charge more money, knockoffs started coming in from China and your listeners are familiar with that. So, you were talking about a $300 GoPro camera or more, well you could buy GoPro lookalikes, knockoffs, whatever at you know as cheap as like $39 or $49 and so that created some erosion. Now, they still have a viable business, but that’s just something that you know brands going to give you some protection, but just something that happens. But kind of the completion of the story you know about the founder, he was a guy who was a surfer at heart, so when the company went public, he enjoyed his success and if you go ahead and Google Nick Woodman, I think you'll see pictures that he bought 180-foot yacht with a helicopter on the back and he goes down and spends a lot of time on surf trips in Nicaragua and you know anyway, he deserved to enjoy the rewards of his success. So, that’s kind of how he chose to spend his money, which is great.

Steve: Yes, yes. Hey, it's definitely – you know, if you're living the dream, you're living that dream, I love it.

Rick: But if you also look at a stock chart of GoPro, they were really high at one point and then they had a dramatic falling and there's also a parallel to kind of the CEO maybe taking his eye off the ball a little bit. I'm not criticizing at all. I probably would have done almost the same exact thing so.

Steve: Well, i think this is a – you know, it's – first of all, you know, anybody who decides what their lifestyle they want and they get to achieve it, kudos to them, no problem. But let's not you know be naïve and think that you know the success that got you there and the kind of momentum and the leadership that got you there won't need to be carried on in some way. And so you know there's all kinds of things that go on with these companies and I think it's a great brand. I think it's a great story and I'm thrilled that you're able to share it with us. I want to switch gears and talk a little bit about OxiClean, which is – you know, the broad range of the products you’ve dealt with show really it's about marketing right. It's about brand building. It's not about the individual product and OxiClean is one of those crazy examples for me. How did this become such a big brand that everybody knew. Can you take us back to the beginning? How did it start?

36:54 (Rick tells us how OxiClean became one of the big brand names that everybody knows today.)

Rick: Sure. That’s another one. And again, you mentioned the book Building Billion Dollar Brands that’s going to be coming out – actually it's released September 24 th , but you know you can go online and get a free registration for it or my website even. But my point is when I talk about this every – and I think I mentioned this earlier in Part 1, almost every one of these companies that are now recognizable brands I started working with when they were doing very low sales and nobody knew what they were. So, let's go back to the very beginning of the OxiClean story. The company was founded by a gentleman named Max Apple and I think Max is probably in his 80s right now, a wonderful entrepreneurial guy. He was probably in his 60s when he started the company, but just kind of a lifelong entrepreneur, trying new things and his son Joel Apple and Joel was a marketing and executive I believe at Nestle or – Quaker Oats, that’s where he was. And so basically their first product was a furniture polish called Orange Glo and the name of the parent company of OxiClean was called Orange Glo International. And their very first product again, they’ve made it a little bit unique. Everyone knows about Lemon Pledge and you use lemon-scented furniture polish, their unique part with this was we're going to use orange oil and that’s what they did different. And the only way they were selling it, they were selling it on the Home Shopping Network in Clearwater, Florida. And they were having quite a bit of success and I'm not sure exactly how they met Billy Mays, but Billy was the person who was on the on-air personality selling the Orange Glo. And their very first infomercial wasn’t for OxiClean, it was for Orange Glo furniture polish and Billy wasn’t in that. So, we're going back again aways when it's 1996 and they were going to launch this new product that they had tested and here’s an interesting concept. They would test products on the fair circuit and I don’t know if any of your listeners have ever been to a state fair. There's always a section of every state fair where you see all these booths and people are pitching products. And that’s where they started pitching the Orange Glo and showing demos getting people to buy it. And again, if you can have success creating a sales pitch at that level then the way you grow a big business is let's take that sales pitch that we know works. People are responding to it even if its one-on-one. How can we apply technology to that to show more people that exact sales pitch and we talked about webinars, we talked about TV, we talked about Facebook advertising, but at the bottom, the foundation is creating a successful sales pitch. So, they went out, tested OxiClean on the fair circuit, had a lot of success, knew it was a viable product and we made Billy Mays as – I don’t know if any of your listeners Billy Mays. He’s passed away now, but at one time he was probably the world’s best pitchman and just a dynamic personality. So, he made his very first infomercial in 1996 for OxiClean and that one unlike the George Foreman Grill, just from the very moment it hit the air we were getting a 4-to-1 return on our ad dollars and you know at that point, go back to your example. Our initial media test is $20,000. We put it on a bunch of stations across the country, get some feedback, so that 20 turned into 80. So, what did we do with the 80? We put it in the top of the funnel and that 80 turned into 320 and pretty soon they were spending a million bucks a month on media. And the thing is when you're growing a business like this very quickly in addition and again, you know this and a lot of your listeners know this, you're spending your media dollars, but at the same time you have to spend money on inventory. So, every business no matter how successful there was always cash draft especially the faster they grow, the more cash draft they are. So that’s really what holds most business in fact and the nice thing about the OxiClean business is there was a very organic growth. I mean they were able to fund their entire growth just from the profits of the direct consumer marketing and again, this is all happening pre-Amazon. There were only two legs to the school. There was TV and then there was online and even online at that point wasn’t fully mature yet. So, you know again, but it's still the same principle. So, with the OxiClean, you know one of the things that they did really well and I think it's a good lesson for people who are single product companies, they had the Orange Glo furniture polish. They had the OxiClean. They came out with another product Kaboom Tub & Tile cleaner and they had a family of products that again took up a lot of space on the retail shelf and – I'll skip to the end of the story. We can come back and talk about a lot of details, but the end of the story is this little family business that was started in Denver, Colorado was able to sell out to a big company called Church & Dwight that makes Arm & Hammer or owns Arm & Hammer brand for $325 million and probably the reason that they got – were able to get so much money was they basically took away so much shelf space in the cleaning section of every grocery store across the country that their competitors like Procter & Gamble and Clorox an in this case Church & Dwight said, “They're stealing shelf space from us. We better buy that.” And that’s what happened so.

Steve: I love that. And we'll come back to some of those details. It is very interesting to hear that reference because I actually also had a case where we kept taking space from – in big boxes from some of the major brands and we at some point a Chinese factory said, “Hey, we want to buy you.” And I'm like “Yes, I'm not opposed to it. You know let's make the deal right.” The word got out. We got a couple more offers, all unsolicited. We never put anything out there. And then we had one of the big brands that we had been taking shelf space show up and more or less are like hey, we can do this the easy way or the hard way and you know because their premise was they needed that shelf space back right. And I'm sure that part of that acquisition and part of what drove the value was Church & Dwight, if that’s the right name, they wanted to get some of that shelf space back through whatever means necessary including buying those brands that were taking the space.

Rick: Yes. In the case of Church & Dwight, it was a combination of getting some back, but for them I was able – if you look at the companies Clorox, Procter & Gamble with Tide and all of that, for Church & Dwight they were kind of the smaller company and for them it was a way of expanding their shelf space in one acquisition, so that was their philosophy or mentality.

Steve: So brilliant. So, we're going to come back and talk about it, maybe a couple of defining moments or tipping point in the building of that great brand OxiClean. We're going to do that right after this break.

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Steve: Okay. We're back everybody. Steve Simonson joined by Rick Cesari and I think I'm two out of three on the day. What do you think–

Rick: Yes, you got it nailed now.

Steve: All right man. I will apologize in advance for the next time I screwed up, but you know I love going through these billion dollar brand stories and I just want to remind Awesomers out there that these things everybody started the same way we did. They started as small businesses and they just started thinking about you know unique ways of getting out to the market. I mean how many of us now would ever consider of going and testing the fair market, you know the state fair market. But I could tell you every state fair I go to there are at least you know a dozen or more booths and the guys got the you know the microphone and he’s pumping out the pitch and they all want to be like Billy Mays of course right–

Rick: Absolutely.

Steve: –the most famous pitchman ever and they're selling everything from knives to you know barbecue equipment and so on and so forth and I just want to remind Awesomers out there that not only is Amazon not the only game in town, E-commerce is not the only game in town. There's just a lot of ways to test and validate your product and then when you find something that works that’s when you double down or triple down or whatever you got to do. So, take us in to maybe where OxiClean – you said from the very beginning you started the infomercials you got great ROI, was there any tipping point or challenges along the way that became defining moments later?

Rick: You know one thing that – well, let me go back and go like we talked about the very beginning of OxiClean and one funny story about before we ever started engaging with them and doing business – and again, you're from Seattle. You might recognize this other product. I was already on the air with another cleaning product called Quick ‘n Brite. I don’t know if you’ve ever heard of that or run into that one.

Steve: Vaguely familiar, yes.

Rick: Anyway, it was a very effective product. The infomercial was working great, but I mentioned earlier about one of the things that you need to be able to go from a smaller business to a larger business is having the right management structure in place and that was a company where they didn’t do the right things from a management perspective and didn’t have some success, but the point of the story was the two founders of OxiClean, Max and Jill Apple, they wanted us to do business and I kept saying no because it was competitive. I was already in the space. I always had another client and I probably told them no for about three or four months before I finally said, “Okay, we'll take this on and do it.” We’ll just keep them really separate and the fact that they were in different – they were in a cleaning category, but different types of cleaning type of thing. So anyway, that was just kind of a funny thing that we didn’t actually start working with them right away. Again, on a tipping point for this and I don’t know if it's going to be totally relevant to all your listeners. When you make an infomercial, you're a small mom and pop business, you're selling at state fairs, you're selling at Home Shopping Network. You spend a couple hundred thousand dollars to make this half hour TV show. You do the media test. As soon as you get those numbers back where you're getting a four-to-one return on your ad dollars, all of a sudden I can probably project out there were a couple of million dollars in sales and I would say without hesitation just from that first weekend of media testing I knew we could build us into a $50 million business because what we did is we had an advertising vehicle that was returning you know what we needed to on our ad dollars. And again, the lesson to apply from that is it doesn’t have to be TV. Any advertising vehicle you could get that returns like that you can use it to leverage and build the business. So that was the one tipping point. The other thing that happened quite consistently and again, this is kind of just kind of eyes widen open as you're building your brand, building your business when some of the landmines or hurdles and it happened both in Sonicare and with OxiClean. In the case of Sonicare, the big 800-pound gorilla is in the space at the time which was Braun Oral B basically attack you and try to keep you because you're threatening them and they attack you by basically turning you into the different you know regulatory boards even if you're doing everything all right and then they sue you for whatever reason and they figure a small company will tie you up in court, make you waste your resources, make you unfocused of what the goal is. That happened with Sonicare when they were growing it with and you know versus Braun and Oral B and then it also happened with OxiClean. In this case, Clorox came in and said, “We want to do due diligence,” came in, looked at everything, everything their books, their marketing, everything then came back and basically tried to shut down the company by starting lawsuits and things. And again, a lot of time you don’t have to worry about that until you're starting to – you're like a mosquito on the big person or big company, but both of those things are kind of things that happened as you're growing and successful, but a long winded answer to your original question the tipping point in almost all these businesses is when we found the advertising vehicle that was giving us a return on our investment we knew then that we could use that to turn it into a big business. And you know you talk about the branding, you’ve heard the term building the airplane as you fly it–

Steve: Oh yes.

Rick: Almost every one of these brands you don’t sit there with a branding company and spend tens of thousands of dollars picking out colors and logos and things. I'm a believer and I think I mentioned this earlier and I think you too, get the product out there, get people buying it, get their feedback, make some changes, get it back out there or keep it out there and you're kind of developing the brand as you go based on consumer feedback and that’s just kind of a really foundational philosophy that I have.

Steve: It is good. I definitely share that. We have had pictures in our office of building the airplane while we fly it. We definitely believe in kind of just moving fast and iterating as quick as we can, but a couple of things I want to call out to the Awesomers out there listening. The first is don’t be surprised the more successful you are when a lightning bolt strikes. You will be sued by somebody. It doesn’t matter if the suit has merit. You can still be sued right and sometimes it's the fairest competitor, sometimes it's just trolling you know patents or other kind of lawyers who have found some little wrinkle in the law that they want to exploit. So, you know don’t be surprised when this happens. You want to do what you can to prevent it, but you know you can't prevent everything so don’t be surprised when it happens. And the other thing is you know just remember that every brand you know they started somewhere. They started with an idea and all of these brands I think have in common that they had margin right and we talked about this in the first part of this episode,Part 1, if you don’t have margin, you can't sustain the marketing. You can't double down on you know marketing because if even with your great return if you know it's like hey, we spent $20,000 in ads and it's $80,000 of sales, but the product is $60,000 in sales so now we just broke even. It's like no. You know, you can't run a business like that. You actually have to have a margin. Is that something you fundamentally agree with Rick?

Rick: I absolutely 100% agree with it. When we're analyzing, you know we have a lot of companies come to us with products and they're having some success in some area whether it's Amazon or somewhere else, the very first thing I ask, one question, which talks about margin is what are you selling it for and how much does it cost for you to make it. And there's lots and lots of great products out there that don’t have the right margin for us to do our direct to consumer marketing. And it just – the margin dollars are so important, so you learn to say no to products that are – that have a following, that have some success however they got there, but you can't layer in the mass marketing techniques that you need to get to a much bigger level without the correct margin. So it's really – and actually you know if you're looking for products to launch for the first time, really look at the numbers first and make sure there's a margin. I mean there's not a great rule of thumb, but if you don’t have at least a three-to-one markup, you're not going to have a chance of success and that’s very very little minimum and the only exception to that is if there’s a continuity you know that people can reorder, but again you're going to need a little bit deeper pockets because you basically take into account the lifetime value of the customer. Like if they order your supplement or they order your cream, how many times are they going to reorder once you spent your money to obtain that customer? So, we get into – you talk about the margin, we get into a very sophisticated financial analysis before we ever get involved with any product to make sure that the numbers work and I think you can write that down as one of the basic rules is make sure the numbers work or how or the margin is there and that’s – I not only agree with it, it's kind of like another one of those axioms you have to follow.

Steve: Yes, I like that. I like the fact that Rick’s on board with the axioms instead of me being a crazy person in the corner repeating the same stuff over and over again. Rick, let's talk about the book and maybe tell me when did you decide to write it and why did you decide to write this newest book because you also have another book as well in the past.

56:03 (Rick talks about his first book, Buy Now .)

Rick: Yes. My first book came out in 2011. It's called Buy Now and that talks about – that goes into really good deep detail on the Trillium Health Products and the Juiceman business and my early – we talked in Part 1 about my earlier career in the Green Bay. You know everything kind of up to through the George Foreman Grill, but you know that I've felt there was a lot of information that wasn’t communicated in the book and what it dawned on me was that almost every one of these products I worked on we used you know they all have certain criteria. You know we just talked about margin and we always did certain things to help make them successful. So, what the Building Billion Dollar Brands is about is really exploring you know I have something available to your list the five keys to building a great brand. That comes from the book Building Billion Dollar Brands and it's like five things that you need to look at or put in place if you want to rise above the other products out there. And so it was really the book came about of just trying to put together information that could help people when they were launching a product or starting a new business, looking at it and my co-author in the book Barb Westfield, she says I'm the optimist and she’s the realist. So, I've always looked at all the good things that can happen and so one other nice part of the book is that she looks at all of the dotting Is, crossing the Ts, making sure you have patents and you know all that and you’ve done searches and making sure you're not infringing on things. She takes care of all of the – you know be careful you don’t do this or you'll get in trouble down the road type of thing. And so it's a good combination of experiences for anyone who’s launching a new product or wants to take their existing product kind of at the next level.

Steve: I love it. I can't wait to get a copy of it myself. Now, first of all, you mentioned the five things to prepare, is there a certain weblink or something we should link to in our show notes?

58:22 (How listeners can download the Five Keys to Building a Great Brand at rickcesari.com .)

Rick: Yes. If your listeners will go to my personal website, which is rickcesari.com , they can download the Five Keys to Building a Great Brand. There's a place for them to do that and then we'll just send it out, a link to it automatically and it's great information. It's not just the five keys, but it's – for each key I give a specific example from one of the products we've talked about during the podcast, you know the first half and this one, too. So there's real specific examples that can really might incite some ideas for whoever is reading it for the product that they're working with.

Steve: That’s great. Well, it really is some of these fundamental things are often overlooked and the more prepared you are as always going in, the better off you'll be. So, we'll definitely get those links in the show notes page. When you think about the book and so forth you know what do you think that people after they read it, what do you think they will do in terms of taking action or what should they do perhaps to take action to harness the lessons found in that book?

Rick: You know, one of the things I talk about because I wanted to write the book from the standpoint of being an entrepreneur and really starting several businesses and then looking at a lot of other businesses that were startups that we work with through the agency and I wanted to give people out there kind of just foundational information, axioms that they should look at that’ll really shortcut maybe their path to success or launching their product or generating sales and it's really basic fundamental stuff that kept recurring through every product marketing and brand that we built and maybe I'm referring it to it as you know common sense knowledge, but maybe for me, but you know you have a way – I enjoy talking with you Steve because you have a way of boiling things down to very simple understandable bullet points for your listeners and that’s what a lot of it is in the book is okay, these brands are recognizable to doing big sales, but they started down here and they did these five things and that is one thing that helped them get up there and so it's really good information for readers that are like I said launching a new product, launching a new business or taking an existing one and want to take it to the next level.

Steve: Well, this is a great opportunity for everybody out there because you know what's common sense and what is second nature to Rick at this stage in his experience is certainly like a foreign language to most of us. I mean we don’t understand all the things going through it, so the chance to kind of see into his experience and into his mind along with his co-author as Barb Westerfield?

Rick: Yes, Barb Westfield and just real quickly about Barb, she was the CMO at Salton Housewares when Salton was the company that bought our juicer business Trillium Health Products and so I started working with Barb to help expand the juicer business and we had also launched another product at the time, the Breadman Bread machine and we were just doing you know not just, but it was probably a $3 or $4 million product. She had a personal passion for home cooked bread and she was able to build that Bread Machine business into a $100 million business back when Salton owned it. And so we kind of hit if off being product marketers together and she was the CMO through the whole George Foreman Grill. After Salton was sold, she basically started working at a company called HoMedics and she was the CMO at Wolfgang Puck, a lot of the housewares and she knows more about housewares, forgot more than I'll ever know and not know that – she’s the one that would do – she’s fluent in Mandarin. She goes over to China, deals with all the factories, basically the manufacturing and packaging and helping get them launched and so we also could talk about not just billion dollar brand. I'll give you a really good example. There's a product that Barb and I were involved in. Barb was a little bit more involved called the SousVide Supreme and I don’t know if your listeners – SousVide is a type of cooking where you cook the product in a water bath and here’s a product that’s coming out, the CIO, Chief Information Officer at Microsoft wrote a book about this SousVide cooking and kind of put it on the map. And so Barb helped the company develop a machine and really help grow that business from zero to $50 million really using again, here is an example of content – you mentioned content is king and how important it is, really what that company did was make about 200-recipe videos showing them using the machine. They were on the website and basically built it through content marketing. So, it's not just about TV. We go into lots of different ways that you can get to the same result, different types of marketing so.

Steve: Oh, it's just the opportunity to learn from people who’ve been there, done that and by the way, I still have great respect and admiration for somebody who’s done it once and you know they got there maybe a little serendipity along the way, but you know between you and Barb, you guys have done this again and again and again and you know it's at the point now that $50 million business is our rounding areas, right. You know it's like hey, we can go bigger. So, I really appreciate the fact that we can learn about you know how build billion dollar brands from somebody who is so experienced and I want to just give you extra gratitude and thanks for your time and commitment to sharing with the Awesomers out there for this special two-part episode.

Rick: Yes. And then Steve I really appreciate you giving me the opportunity to expand on all of these different products and brands and hopefully the information that we talked about and shared, you did a really great job of pointing out the axioms or different business lessons from me rambling about and telling stories. So, you do a great job of bringing it back down to the listeners and tidbits that they can take away from it. So, I really appreciate that and also appreciate talking to you from like from one entrepreneur to another because you get it. You’ve been through it and you're able to ask the right questions which is you know is great for me to be able to answer them, so thank you.

Steve: Well, definitely it's my pleasure and it really does – you know, for the Awesomers out there listening, you know when you’ve kind of walked the same path, you’ve been in the same shoes it's really easy to see the parallels. It's easy to see the lessons and that’s ultimately the mission of this podcast is to bring brilliant people like Rick on board and share some of those experiences and try to call out some lessons so that people listening can take action, that you listening right now you could take action and you may be the next billion dollar brand, we don’t know. If that’s what you want, you can do it. There are many ways to do it and it's not just a single path to get there. There's a lot of ways to do it. So thank you once again Rick and any final words of wisdom for the Awesomers out there?

Rick: No. Just keep doing what you're doing and learn from other people’s experience.

Steve: I love it. Sage wisdom as always. Awesomers, we're going to right back after this.

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Steve: Well, Rick always delivers right. He just delivers the goods and his experience and his willingness to share – just his enthusiasm it's all contagious and you really see you know how you can architect from basically just any small thing as long as you have a good idea and as long as you really understand margin and how to put things together, you can do it. You could build a billion dollar brand. One of the things you should have as a takeaway is you could shortcut and you can grab all of Rick’s extraordinary experience by buying his book Building Billion Dollar Brands to help you grab that valuable knowledge that big brands already know. The big guys know this stuff. They have guys like Rick or Rick himself on the payroll and now the small guys, the inventors, the small business owners, the entrepreneurs, the Amazon sellers, the E-commerce folks out there and really anybody who’s got a creative idea now you can have that same arsenal of information right at your fingertips by buying the book. So, I can't wait to buy the book. I think I've actually already preordered it on Amazon at the time I recorded this. By the time you're listening to this it's live, go buy it right now. Don’t hesitate. Let's do the right thing and get this thing done. I know that you will be highly rewarded as a result of this and I hope that you see that Building a Billion Dollar Brand is not just some lucky magic strike you know lightning just happened to hit this one lucky guy. Rick has been able to do this over and over and if you’ve heard of OxiClean, if you’ve heard of GoPro, if you’ve heard of the George Foreman Grill or the Ultrasonic Toothbrush, those are all brands that were built and developed you know over the course of time on direct response media and that to me is one of my favorite kinds of advertising because it's dollar in as we talked about, the funnel money, a dollar filling the top and money comes out in the bottom, that’s what makes it sustainable, that’s what makes it replicable and that’s what makes it truly amazing business that could scale. Now this has been Awesomers.com Episode Number 56 and I know this is a back-to-back episode. They're kind of long, but all you have to do is go to Awesomers.com/56 to get the show notes and details. This has been a power-packed back-to-back series. I hope you have loved it as much as I did.

Well we've done it again everybody. We have another episode of the Awesomers podcast ready for the world. Thank you for joining us and we hope that you've enjoyed our program today. Now is a good time to take a moment to subscribe, like and share this podcast. Heck you can even leave a review if you wanted. Awesomers around you will appreciate your help. It's only with your participation and sharing that we'll be able to achieve our goals. Our success is literally in your hands. Thank you again for joining us. We are at your service. Find out more about me, Steve Simonson, our guest, team and all the other Awesomers involved at Awesomers.com. Thank you again.