How acquirer Suma Brands approaches branding, marketing, and omnichannel⎜ Suma Brands ⎜ EP 214
Ryan Cramer: What's up, everyone? Welcome to my corner of the internet. I'm your host, Ryan Cramer, and this is Crossover Commerce, presented by PingPong Payments, the leading global payments provider, helping sellers keep more of their hard- earned money. Hey, everyone. Welcome back to another episode of Crossover Commerce. I'm your host, Ryan Cramer. And this is my corner of the internet, where I bring the best and brightest in the Amazon and e- commerce space. If you're new to the show, this is where I talk with everyone in the space that can help you level up your business, whether it be just starting out on Amazon. You've thought 2022 is the year to start the entrepreneur journey, or if you've grown your business to the next level and you are maybe looking to learn about exiting your business, or just want to know what opportunities you can to grow your empire, your e- commerce empire, if you will, to another level internationally or whatever your goals and ambitions are, we want to educate you in this space. So without further ado, this is what Crossover Commerce became. This is episode 214. And like every other episode, this podcast is presented by PingPong Payments. Who's PingPong Payments? We are a cross- border payment solution helping international sellers when it comes to either paying their VAs or suppliers, your manufacturers. Pay them out in localized currency, putting more money back into your pocket. Or if you're selling on multiple marketplaces, whether it be on Amazon, Rakuten, Coupang, MercadoLibre, the list goes on and on. We talked about it yesterday, 200- plus marketplaces that exist worldwide. There's a lot out there. And if you happen to be growing your business on those platforms, let ping pong collect more money for you to help you save on those fees when it comes to international transactions. It's free to sign up, just go to usa. pingpongx. com/ podcast. To look at our past episodes, plus signing up for free, just mention Crossover Commerce. Without further ado, it's Friday, February. It's not January anymore. February 4th, according to my clock here. Because it's Friday, we like to have a little bit of a more interaction, more of a conversational podcast. I'm really excited because typically on the podcast, if you're familiar with our format setup, it's live, so we get to ask questions. You get to ask questions if you're listening to us on LinkedIn, Facebook, YouTube or Twitter, if I can speak today. And if you have those questions, go ahead and put those in the comment section below wherever you might be watching and we'll be able to see them here on our platform and throw them up on the screen. But if you happen to be listening to us later on, or if on the audio format when this comes out, you can also just tag our guest and we'll be able to get those questions answered. But one of my favorite topics to talk about, if you're familiar with the show, is the aggregation space or the roll up or the brand acquisition space in Amazon and e- commerce. There's so many iterations out there, we've had many of them on before in terms of brands, companies, it might be private equity companies that we've talked to, or just other brands, absorbing friends or businesses that they might have done before. What really intrigues me, and maybe it's for a lot of sellers out there who have asked these questions too is, what happens after the acquisition? There's typically that process, once you exit your business, what does that look like? Your brand doesn't die, it just moves on to a bigger, better place, hopefully. In that space, that's where the aggregator or the brand acquisition company exists. That is fantastic for a lot of different sellers out there. But my job for you today is to find out and peek behind the curtain, if you will, behind the Wizard of Oz curtain, if you will, and see how the inner workings work, what's the next steps once that handshake, that pass off happens, if you will, and where a brand's legacy lives on. So we're going to be talking with really cool company called Suma Brands today. I'm really excited because I have one of their co- founders and CEOs, Andrew Savage, and I have their head of brand marketing, Alaina, as well. Just fantastic people. I appreciate that we were talking beforehand, so let's go ahead and talk about today. We are calling in this episode, let me go ahead and pull up my notes real quick, How Suma Brands Approaches, Branding, Marketing, and Omnichannel. So if you're taking notes, make sure that you have plenty of paper. We're going to be diving into all those different topics today. Welcome to Suma Brands. Andrew and Alaina, I'm going to go ahead and unmute both of you and we're good to go. Both of you, thank you so much for hopping on today.
Andrew Savage: Hey, thanks for having us, Ryan. Really happy to be here.
Ryan Cramer: Yeah, appreciate it.
Andrew Savage: My random thought, I love your intro song. I was thinking about this. We do so many video meetings and stuff, I think I want to have like an intro song for me.
Ryan Cramer: You need a walk up song,
Andrew Savage: Everybody should have like their walk- in song.
Ryan Cramer: Absolutely. Playing in sports myself, I had a walk- in song for baseball too. I'm trying to think about it off the top of my head since you mentioned that, but for both of you, I've always thought Waking Up was a good entry for like The Circle of Life or something like that. That would be pretty epic, but we'll have to think about that. If you're listening to this live to let us know that walk- in song via Zoom Meeting.
Andrew Savage: If you're listening, comment on what would your walk- in song be for like your Zoom meetings? I think we're going to maybe try that at Suma.
Ryan Cramer: I was going to say, you're the head honcho Andrew, you can implement whatever you want.
Andrew Savage: Yeah. To make me more fun. I like that idea. You inspired that, Ryan.
Ryan Cramer: Alaina is just shaking her head over. She's like, " Oh my God, what did I agree to?" No, it's a pleasure to have both of you on. Andrew's joining us from... I almost said Wisconsin. That's not okay. Minneapolis, Minnesota. And then Alaina, you're joining us from Brooklyn, correct?
Alaina: Yeah. Yeah.
Ryan Cramer: Awesome. Well, both of you, welcome. It's a pleasure to have you both on. I'm assuming you guys see each other quite often, but for those who are listening and watching today, tell me a little bit... Maybe I'll start with you Andrew, since you're the co- founder, CEO, if that's okay with you. Where did Suma Brands originate from? What was that journey coming to this business and where we are today?
Andrew Savage: Yeah. Well, again, thank you for having us. In terms of the journey to Suma, there's two sides to the story. One is the personal arc of my career, I was involved with e- commerce from the really early days, helped build Target. com out of school, spent some time with Amazon, helped build a business called Dolls Kill out of San Francisco. And so the arc of my career had been getting more and more entrepreneurial and had always wanted to found a business and be a startup CEO. And so that was one driving motivation. And then I would say as I've progressed in life, as I've gotten older, I guess, I've just had an increasing appreciation for the fact that a lot of the depth in life is created by little day- to- day moments and not necessarily the big things. It's little things that happen day to day that you smile, make your day a little bit easier. And realizing that a lot of those moments are created by great products and inspiring branding. We all have had that experience where you buy something new, it changes your life in some little way, and then you can't stop talking about it to the people that you interact with. The ultimate goal for Suma is to be involved with more of those experiences and really bring what we have from decades of e- commerce operation and scaling business online bring, that to bear on really fantastic brands and products that founders have started in the Amazon marketplace. And so we really see our role as, how do we amplify these really, really strong starting points that founders have gotten off the ground, and how do we get their amazing products into the hands of more consumers through more channels? And how do we enhance and professionalize the branding that's wrapped around that to make those consumers feel even better about that interaction? At the end of the day, that's the driving force behind Suma, that's why we're all here. It's what gets us out of bed in the morning is, how do we get great products into the hands of more customers wrapped in brands that really inspire and connect with them? And that's what we're doing.
Ryan Cramer: Yeah. I love that. Going to your website, which it looks very well put out there, I would say it's more brand focused than almost any other, maybe aggregater in this space. This is a pat on the back maybe for Alaina or anyone on the marketing team of, it looks more like a branded site that if I was an agency or if I'm somebody who wants to work with a person who's brand focused, this is where I think the website is that first gateway, if you will. And that's where I see whether it be updated recently or not, that's my first perception as well. Seems like that's coming through in the marketing. And just when you walk through that virtual door, if you will.
Andrew Savage: Yeah. Alaina gets all the credit for that. And Alaina, you should intro yourself.
Ryan Cramer: Yeah. I was going to say, Alaina. Speaking of it, and now that we buttered you up, what's that background for you, if you would tell us.
Alaina: Yeah. I came from the advertising industry. I was in creative agencies for my entire career. I started working on Fortune 500s. I was on companies like Samsung, Rolex, Nike, Uniqlo, some really big brands with equally big budgets. And so loving that work and doing big takeovers and Times Square and TV production and out of home. And then most recently for the last three years or so, I pivoted to focusing on startups of all stages. We worked on series B first ever integrated marketing campaigns. And then even very early seed stage friends and family fundraise, very finite budget to figure out what to do with from a marketing standpoint. And I just really fell in love with that space. I was working really hands on with founders and CEOs in the very early days. You're super strapped for resources, you don't have budget to bring on a marketing lead. And so you're really leaning on your external agency for a lot. And so it becomes more of a consulting role. So that really led me to this space through a mutual connection, met Andrew. We had an unbelievable conversation, just became obsessed with the FBA space and everything that was happening. And just the idea that you could turn this unbelievable nugget of a product that was having a real impact in someone's life into a really compelling brand. So that's how I landed here. I joined last year and it's been really fun.
Ryan Cramer: Yeah. I was going to say, for 2020, it seems like for those in the Amazon space, it seems like a decade ago that 2020 hit, I'm sure for both of you. So you guys are coming out of that. That's such a cool, fantastic... How big is the company to date? It's a fully remote company, so you guys aren't all in one state. How big is the company entirely?
Andrew Savage: Yeah. We're fully remote. We're technically headquartered in Minneapolis. We have a critical mass of people here, have a bunch of people in the New York City area where Alaina is, and then folks around the country and some around the world. We're growing really rapidly. We've gotten past several of the pivot points. If you think in like the three 10s, it's everything about the way that you do things changes when you get about three people, and then when you get to about 10 people, and then 30 people, and 100 people. So we've been through a bunch of those pivots and have just a fantastic team, like I said, distributed around the world, a lot of different backgrounds, perspectives. Our goal in this business generally is to try to get the best group of people possible around each of the brands that we're working on, that's really important to us. I think that underlying success in a space like this, you have to have people that are capable, but also just passionate and dedicated and obsessed with, how do you make product experiences better? How do you more closely connect a brand voice and vision to the customer set that you're selling into? And it's our goal, whether it's our team, whether it's founders that remain involved with us, whether it's advisors and board members that we have for the business, we're always looking for, how do we put a new acre perspective or set of experiences or a set of capabilities around what we're doing? And we're really fortunate to have a fantastic team. And it's been I think really a good thing for us to have launched this in the middle of the pandemic, from the perspective that we never really had the option to be geographically centric in one location and come together easily. And the silver lining there has been that we've picked up just amazing people on the team that are in locations that don't happen to be where I am or where Alaina is. And we've got a really great toolkit for collaborating and working effectively across the distance. Anyway, I'm super proud of the team. We're growing really fast, except we've been through a bunch of those pivot points and our goal remains, " Let's get the best group of people around whatever we're doing possible and work productively toward delivering additional value for the customer," whoever the customer set is in that case.
Ryan Cramer: I love that. No, that's really cool. So in that capacity, where did the name Suma come from? I'm always super interested in the name. And the logo's pretty cool. I have a visual communications background, I'm a big logo nerd when it comes to any brand recognition, where did Suma come from?
Andrew Savage: Well, I love that you love the logo because my wife designed it.
Ryan Cramer: There you go.
Andrew Savage: I can pass on the compliment, she'll be very pleased. The name Suma, it's hard to name stuff as it turns out. And so did a name storm and we're trying to find the right name for the company, because I think that's important. We were really interested in the visual of like the Amazon rainforest. It's not an original, but it's an interesting analogy to the Amazon ecosystem. And what we're trying to do is acquire great products and the kernel of inspiring brands from out of that marketplace and then grow them out of that. And so we got obsessed with this idea of like, " Well, how about a type of tree that grows above the canopy of the rainforest?" And so there's you called the Samauma tree. That's actually the local Portuguese name for the Kapok tree. And it's a tree that grows to 80- plus meters, just a gigantic tree and rises above the canopy of the rainforest. And so we took a little Liberty just for ease of pronunciation and brevity and shortened it to Suma. So that's what it is. And it represents what we're trying to do, which is acquire great brands from the Amazon rainforest and grow them out of that and above that to reach customers more broadly across more channels and to really build equity in the brand and not just the product as a transactional purchase on Amazon.
Ryan Cramer: Yeah. Strong roots and obviously has a good base and can continue to grow. Makes sense.
Andrew Savage: Yeah. It works on a lot of levels. And somebody pointed out to me the other day that it also means sum or like summation. And so that's obviously one thing that we're trying to do too with the aggregation piece of this model, is bring a lot of pieces together and make the sum greater than the parts. It's turned out to be a good name, I think. It seems like that's what it always should have been at this point, but like anything when you start it, it's new and you got to get used to it, but it feels very familiar now.
Ryan Cramer: No, absolutely. As a company, do you guys publicly announce, how many brands are we to date looking at that's either acquired or you grew in house? What is that operation number looking like right now?
Andrew Savage: Yeah, we don't announce it. And it's mostly because our focus is, again, on building brands and building brand stories and equity. Our goal is, we're very interested in scale and efficiency and like all of the things that we've done throughout our careers and it's a core part of this model. But again, like for us, the guiding light and where we want to end up is with decades durable portfolio of consumer brands. And so I think the outward focus on just the mechanics of scale and everybody's got their playbook and there's all these steps you run through in week one and month one and blah, blah, blah. Everybody has that. I think something that makes us unique and different is the fact that we don't view this as a peer utilitarian and like mechanicals play at scale, we view that as part of the model, but the underpinning of lasting value we think is the ability to have great products that solve a customer problem in a unique way and great brands that are inspirational and connect with customer sets around those products. So we don't want to detract from those storylines associated with our individual brands with like a focus on just portfolio size and scale and like mechanization, all of which we have pieces of that throughout what we do, but it's not the thing that we're the most proud of.
Ryan Cramer: No, it makes sense. So with that regards, I didn't hear you once say we're only focused on Amazon branding and acquisition, I hear consumer product goods, which means a lot of different things. That means it could be a D2C play. It could be a marketplace play of any capacity. That gets confusing quickly for a lot of people, and they don't like that convolution of, maybe I have to figure out what's the split between a brand or coming on to Amazon or going off of Amazon. There's a lot of different iterations there. So Alaina, what for you is that exciting, is that terrifying in a marketing perspective? That means a lot for so many different things. Amazon, you have your own ecosystem, it's about conversions, but off of Amazon, it's driving traffic and you're talking about marketing and building out a customer list and all those things. It's things you know that, but how terrifying or exciting is that for you as a marketer?
Alaina: Well, for me, it's very exciting because you have such a breadth and diversity of the amount of things that you're able to do once you start thinking broader and broader than just Amazon. So I think that we're acutely aware of the customers that are really resonating with the products in our portfolio and what that experience looks like for the consumers within our brands. And so that experience that we're creating, whether it be D2C or retail or wherever we're showing up, it's curated for the customer that we're serving. We're meeting them where they're at, we're making sure that we're showing up for them. And all of these things, as we all know, these shopping experiences are deeply connected and weaved together. And so for me, it's very exciting because it presents a different challenge and it allows the creative team to have a lot of flexibility on the places and the use cases that they're just designing for. And so that's a very, I think compelling part of the story in the hook for us as differentiated in the space for founders too. They've built this unbelievable brand and it's just this small kernel, like Andrew said, of what it could be. And so we bring all this horsepower of our actions in retail and all of our branding expertise and our D2C and omnichannel presence. And so that's an exciting and really compelling differentiator for the founders that we work with. And they're really motivated and energized to see what their brand could look like on other channels and in other places. So, for me, it's really exciting. I don't know, Andrew, if you feel the same, I assume you do.
Andrew Savage: Yeah, of course. I think to be clear, we love the Amazon channel, and I think that will always be a big part of what we do. As customers, we all interact with Amazon, I think it's a fantastic shopping and purchase experience. And so we want our customers to be able to find and buy our product on Amazon, and a lot of what we do focuses on optimizing that channel, but our interest and our goal, I think, starts from the standpoint of like understanding the customer for a product or a brand that we have, and then building out from there, as Alaina said, where are those customers? How do we connect with them? What's the core value proposition and inspirational messaging that makes a higher level connection associated with our product and brand? And then we build out the strategy from there. We're not super prescriptive about like we want the Shopify channel to be X% of our revenue in two years. It's a little bit more focused on and building out from an understanding of the customer group for each of our brands. And I think Alaina's done a fantastic job building a repeatable and scalable system for diving under the hood of a brand, getting at what is at that core, having a clear view of the customer set, where they are, what they'll respond to, and then starting to build inspiring content and messaging and campaigns around that. I think it's super exciting. One of the questions that is always on my mind is, what is branding in the age of Amazon? And you see companies try to do this different ways. Some, they want to be very siloed, they want don't want to be on Amazon, they try to like own all of their traffic and just live in their owned website space. And then you see others that are Amazon only, of course, and you see legacy offline brands trying to come online and figure it out. All of that is in a state of flux, and I think we're really interested in the answer too like, " What does brand building look like in the age of Amazon, where it is such a dominant force online and frankly a world class shopping experience?" And so figuring out what that is and how that makes sense for each of our brands is a big part of what we think about.
Ryan Cramer: Does that narrow down the brands that you look at for acquisition? Do you guys operate as an agnostic approach or is it more focused in terms of a health and wellness or beauty or baby or toy or whatever that looks like, in the major categories everyone looks at of, there's so much profit and there's availability? Or do you more look at a segment by segment? Or is it more of if there's an opportunity for growth or to tell a story behind it, that's what we're more most interested in.
Andrew Savage: Yeah. We both have a narrower and wider aperture than I think other players in this space. Narrower in the sense that our goal and interest is not accumulating a portfolio of Amazon storefronts, it just has an end goal. We want to have great products, we want to have great brands. But also, we have decades and decades on the team of e- commerce operational experience. We've built DTC sites from a few million dollars to hundreds of millions. We've grown categories in multi- category retailers, target. com, Amazon, we've operated marketplace businesses. And so we have a lot of experience that lets us look at a much broader swath of businesses. We can look at 100% DTC businesses and we have the experience to build that traffic base and maintain it and grow it and do conversion optimization. We can look at 100% Amazon. So I think our base in terms of the channel spectrum that we cover is much wider than most. But I think that we apply an additional filter to the typical screener that you see around digital real estate fundamentals and financial profile, etc, where we're looking for businesses that the product we're selling, we would personally use and we would recommend without hesitation to anybody in our life that we care about. And I think that's been one of the great things about this business, is every brand we have, like I get for my family and friends on holidays for gifts, I'm constantly recommending people because we really believe in and love the product. And so that does narrow the aperture a little bit, because a lot of the Amazon businesses out there are not that, but many of them are. And we've gotten really good at finding those types of founders and those types of businesses, and those are the ones that are the right fit for Suma. So, Alaina, I don't know if you want to elaborate on that at all.
Alaina: No, I completely agree with that. I think of course there's something that's really compelling about a brand a story that's already doing a really good job getting their messaging and that story across in that ecosystem. And so it's really exciting to be able to think about, this is where it's at today. And if only we had X, Y, Z, then we could totally amplify and expand what's happening here. And it is also just really motivating for the team that's working on these products to be personally invested in the success of the brand. So that's very motivating. I agree with Andrew, I also gifted a lot of Suma products for Christmas. And so we do have a lot of love for the products and the brands and our portfolio. And I think that is a differentiator. We're not just on this fast path to get a bunch of commodities and storefronts, it's really a more focused and intentional approach to aggregating.
Ryan Cramer: Yeah. Your sales team is loving you guys.
Andrew Savage: What's that?
Ryan Cramer: Buying all your gifts. Hopefully you're going through a successful channel that's... Or maybe that's an in- house, you can just walk down to the-
Andrew Savage: Suma store?
Ryan Cramer: Yeah. Suma store, or I guess a warehouse if you guys... Do you guys have a warehouse with any of these acquisitions?
Andrew Savage: No, we don't operate our own. One of the things I did at Dolls Kill was build the in- house fulfillment capacity. So we've done that before. Currently, we leverage Amazon FBA, obviously, and we leverage some really great 3PLs. So we're not, we're not doing anything in- house at this point, but it's always something that is on the roadmap to consider.
Ryan Cramer: Being the lookout. Yeah. No, I understand that completely. And
Andrew Savage: The other thing I want to say in that is, there's just an enormous volume of Amazon businesses out there, as you know. There's also a huge volume of those that were started by founders that are product obsessed or brand obsessed. And again, that's what we look for. We love talking to founders where they can walk you, they're on like V23 of their product and they've just maniacally set out to make a better mouse trap and solve this problem. And a lot of times, it's like something personal for them. They've tried to find this product that does XYZ, and they've been really dissatisfied with the spectrum of options out there, and so they like set in on a mission to fix that. And I think what's been interesting for us is seeing that, one of the things about the Amazon ecosystem, all the billions and billions of dollars that they've poured into making it easy for sellers to start businesses, is that it's the path of least resistance to monetize a product idea. If you're a product person and you're iterating your widget and you want to sell it, Amazon is one of the easy ways to do that. And so we really view it as it's this ocean that's great to fish in to find these founders that had that product orientation, or have really thoughtfully and obsessively crafted, like the starting point of a brand that's unique and differentiated and connects authentically with customer segment. So there's an enormous population of those out there on the Amazon marketplace. There's an even bigger population of total businesses and a lot of different angles on this space, but that's just ours, we look for that type of business.
Ryan Cramer: Sorry. This is something that I'm trying to think of what path to go out that because it's so interesting and refreshing to hear looking at more of, I'm hearing more opportunity of iterations or just helping, instead of looking at bottom line numbers, it's really cut and paste, and you can just put it into a spreadsheet instead of... Not to say that every aggregator does that, but it's more, how do you put the product at the forefront and let that speak and maybe like, what is that going to look like in the future, a repeatable process, an add- on process. A process at which it's going to truly do what it says it is instead of like, " Hey, this is a fidget spinner, it has a shelf life of two years, it's going to be really popular and then it's going to die if will kill it and then move on to the next widget, if you will." Is that important for you guys maybe internally to either not just build externally or acquire from externally, but also build internally your own brands and own processes and own products on Amazon? Is that on the roadmap as well for either of you?
Andrew Savage: Yeah, it's definitely on the roadmap, we're building and have the muscle to do that type of thing, Alaina and her team, and she can talk more about that, our product and brand team, but right now we see so much opportunity and so many great starting points that have been built by founders. And it's really fun to be part of the process of rewarding them with an exit, benefiting from working alongside them for some period of time where we can learn from them about what they've done that's excellent on their brand. And we've been so impressed, the quality of founder and person that's out there running these businesses, we can learn a lot from them. You hear a lot other players saying like, " Oh, cut the founder out, and we have this playbook and we make everything better." And our culture has really been focused on trying to be low ego and always to be seeking the truth and to learn and to get better. And the fact is a lot of these founders are doing things very, very well, and in a way for their space that it takes a while for a platform to catch up with. And so we bring the things that we do really well, start optimizing that from the start, but then get the opportunity to learn from them how they built the brand, about the customer set, their obsession with the product. And so we ramp up on that alongside them and then they learn from us. And so it's really a creative experience on both sides. And so that's something that's really important to us. I think at some point we would consider launching our own brands, but there's just so much opportunity out there right now to continue to reward founders for the great things that they've built.
Ryan Cramer: Absolutely. Alaina, I guess in that question, when you are rewarding them, I'm assuming that every single time that a business is in talks or has these interactions with you or with other companies or Suma, there's this promise, there's this unspoken promise or maybe spoken promise of, " This is your baby, we understand you put blood, sweat and tears. We see the passion, we want to replicate that, but amplify it. We don't want to replicate it, we just want to amplify that and build on this legacy." Is that a way that you and your team have to deliver with, or how do you help with the vision of that grow as part of Suma, but also having that genesis of where they started it from?
Alaina: It's a good question. As Andrew was talking, that was what I was thinking too, is our team is so thoughtful and really, really focused on delivering on the promise that we made to these founders. They brought us their business and it's their baby and they put a ton of work into it to where it is today. And I think a huge part of this is being really humble and being really in tune with the things that have worked. And so you hear a lot about people taking brands and in this space taking where they're at and then saying, " We're going to put it through our playbook. We're going to up level it, we're going to do X, Y, Z," but the reality, but something is working really well about what they're doing today. And so we all have to acknowledge that and we have to get to the root of what's working. And what would be a total catastrophe was if you did some massive rebrand or some huge change that totally destroyed and alienated the customer side. So we come into it with a lot of curiosity and very low ego and wanting to just really get to the root of what's working. And it's a huge responsibility. They have put the trust in our team, in some cases, they have an earn out, they're still very invested in the success of the business. And so we all carry that and we take that responsibility very seriously. And so all the more reason while we're looking at a deal, while we're going through the process and the upfront that we all are in agreement that this is something that we're motivated by and we believe in, and that there's an interesting story and that we feel like there's a high level of confidence that we could do something really great with it.
Ryan Cramer: Is that a resource that you guys tap into a lot as the founders and you go back to them and say, " Hey, we're thinking about maybe updating the packaging or the logo or something along those lines, something that doesn't necessarily define the product, but something that enhances it? Is that well that you guys tap into or find success in?
Alaina: Definitely. I have a really close relationship with all the founders that have sold to us because there's always a constant stream of communication. And so as our team's going into ideation for new ideas and coming up with seasonal content or what we're going to do for upcoming spring, summer, whatever it might be-
Ryan Cramer: Promos.
Alaina: Yeah. Promos, offers, everything is informed. And the starting base is what did you do last year? What worked? What worked well? And there's only a certain amount that you can really get in the two to four week transition after whatever the period of time where the founders are really involved. There's only a certain amount of information that you could really get, like, how do you download the whole history of five years of running a business in that short amount of time? And a lot of our founders have just been really excited and really energized by the work that we're doing. And so when we come back and say, " Check out this creative, check out this thing that we're working on, what do you think?" They're super excited to see it and they love it. And so we take our relationships with our founders really seriously, we want to keep them in the loop and involved and they like to see it too. And then on the flip side, if they don't want to be involved, then we won't bother them. So it's really driven by them. But I think in the most cases for us, because probably driven by this like filter of how we've looked at companies, they have put their heart and soul into this, it's probably born out of a personal need. And so there's a lot of emotion wrapped up into the brand itself. They do want to stay involved in some capacity and at least be looped into what's going on and see. And it's fun for them to see what we do and see what they could take. We just had this experience with one of our brands and we went back to the founder and he was like, " I have been saying this for so long and I can't believe to see it come to life. It's just this totally surreal feeling to see everything that I've wanted for this brand to be manifesting." And so, that's amazing for our team to feel, for us to feel, for us to see that journey. So I feel like it's a huge responsibility, but it's one that we welcome and that we're really excited about.
Andrew Savage: Yeah. And I would say just tack onto that, there's certainly areas where we come in and we can immediately make a big impact on the business because we can bring more capital to bear, because we have built sophisticated planning and supply chain processes and have better rates and more integrated partner relationships, etc. And so there's a big swath of things, we do come in and there's room to optimize right away. I think what Alaina is describing is there's a lot of value for us. And I think we've seen for founders and having this more ongoing collaborative experience around, really making sure that we're doing the right thing for the customer set and not missing something that they know from years of being buried in the business every day and obsessing over it, and thinking about the products since they've been through all these iterations, there's often things they've thought about and tried that we can get ahead of. And so like really on that side of the business, we get a lot of value from interacting with founders and we're able to take all the stuff that is often less enjoyable for product and brand oriented founders off their plate, and optimize that based again on years and years and years of doing this at scale and understanding how you get efficiency out of inventory planning, working capital deployment and supply chain, for example. So we look for that win- win where we're taking the time to understand the things that they do uniquely well, but we're moving quickly on the things that we do uniquely well.
Ryan Cramer: Absolutely. Well, has that conversation changed from 2020 to like, if you had a conversation today with the brand owner, has that struggle or those barriers different in terms of their eyes of, " It was easier back then, now I don't have the capital anymore. I can't figure out logistics. I can't magically make my goods appear in port or in a warehouse anymore. It's such a struggle and I don't have any capacity to grow it." Is that conversation changed in different ways in both good or bad ways, Andrew, that you're seeing?
Andrew Savage: Yeah. I think it's not a secret that supply chain is tough right now. I think even if you're not close to the space, you see the headlines on that. That's how big of a deal it is. And navigating that environment with extended supply chain and higher freight costs, the need for more working capital, I think that's multiples harder for bootstrapped solopreneur than for a well- capitalized enterprise level operator. And so I think that we're finding more win- win scenarios where we, again, we've built the infrastructure and spend a lot of time trying to find founders who still really believe in their brand and they're struggling with the pinch point created by supply chain right now for example. And we can come in, help solve that, layer on other things that will drive growth and still give them a share and the success of the business. So a lot of the founders that we work with are very interested in their brands. They believe in their brand, they might have continued to operate it if supply chain was running really smoothly, and they didn't need help at the end enterprise scale. But those relationships are great because it's a win- win and it makes the pie bigger and it lets them keep some of the upside in what they've built and it lets us apply what we do really well to helping that scale. And again, at the end of the day, get that great product into the hands of more customers to create more of those daily moments that add a lot of flavor to life.
Ryan Cramer: Obviously at scale, you guys are looking at growth. I think a lot of people back in 2019 before everything somewhat came into lockdown, there was a lot of talk about international growth. There was this momentum, and I think it really throttled in the past two years, but I think now 2022, is this momentous occasion where I think a lot of people have said, " Hey, we figured out logistics, we have that unlock as best we can. We have overcome all these different channels, but we realize that there's not just one channel we can solely depend on. It's not just Amazon, it's not just D2C, we have to be in multiple different places in order to scale." What does that omni- channel approach look like to Suma? Is that D2C, is there more of a marketplace focus? What does that omni- channel approach look like to you and the team, or is that different from brand to brand?
Andrew Savage: It's different from brand to brand in terms of prioritization, but we think D2C is a big part of most of the brands that we have in our portfolio and we're working with. We've built those businesses in the past, we think it's a great channel because you can do a lot more storytelling in a lot more flexible way than you can on marketplaces. And so I think that's pretty much always going to be part of what we do. We're big believers in brick and mortar, I know that sounds weird to say, but-
Ryan Cramer: It's not weird.
Andrew Savage: It's a huge chunk of retail and I don't think it's going to zero anytime fast, even though e- commerce is definitely the space to be. And we really see it as brand building in that I think as consumers, we all fundamentally understand that if you see a product online, you see product A and B online and two weeks ago you saw product A on the shelf of a retailer that you have in a creative relationship for, product A has more brand credibility out of the gate. And so we see it as a volume channel, as a way to get in front of customers, but also as a way to build our brand through a creative relationships with high quality retail partners. And so we think that that's a big channel. And then certainly the other marketplaces. So for us, it's really about prioritizing for each brand where we think the biggest opportunity is. But again, our philosophy on building this business is we're building consumer product brands that align with customer sets and we're not really trying to be super prescriptive about what channels we grow. We're trying to understand where are those customers, how can we best reach them? What's the right messaging to put in front of them in each of those places to get them engaged with the brand? And so we're really thinking more about customers than channels for the sake of channels, if that makes sense. Alaina, I don't know if you want to layer anything on to that.
Alaina: No, I completely agree with that. And also just making sure that we're tailoring that experience by the place that we're showing up, but then it also feels really cohesive across. To a customer, they don't care where they find you, it needs to be the same brand either way. So making sure that we have a lot of rigor around that as well.
Ryan Cramer: Right. Well, and to throw data statistics, which we all should be following if we're in business and entrepreneurs is, e- commerce is only 15% of all of retail, where a transaction happens. And it seems such a small part of the pie, but that's what's exciting. I'm assuming for businesses like you is, Amazon is half of that 15%, but again, going into retail store, if I see it in a grocery store, CVS, or going to a Macy's, whatever retailer is still operating out there in a brick and mortar store, that's where majority again, 75, wait, walk back. Let's do math today, 15% or 85% is 15. Let's do math today on a Friday. There's 85% of business is still happening in a brick and mortar store. So wherever that might be happening, it's a big play in where you're going to see eyeballs on a day to day basis. Shelves are still king, and if you can get retail stores... I used to work for a D2C company, and I still get giddy when I see some of the products I was selling in a gifting garden store, that's weird. And I didn't work for them for four or five years ago, but I still think it's really cool to see brand right condition, it's on a shelf, that has a power too in itself. It's hard to brand on Amazon that it's getting better. I know people are still the follower of functionality, the A- plus content, all that good stuff that we can talk about ad nauseam on this podcast before, but it's super important to make that play into retail stores as well. In the couple of minutes that we have for both of you, what does 2022 really mean for you guys? I'm assuming like now we're coming off of high of Q4, hopefully everything was successful and you guys saw tremendous growth, if you want to add onto that, but what does the momentum look like for 2022? Where's that really big focus for you guys?
Andrew Savage: Yeah, I think I can hit that at a high level and then Alaina can maybe talk about it from a branding perspective. Our business is accelerating, we're doing progressively more and more deals, each month. We're finding more and more of the businesses, the, that we want to be involved with. And so that's really great. So I think 2022 is going to be big in terms of just increase in scale for us, but increase in scale in the right way, acquiring the type of businesses that's the best fit for Suma and what we do. So I'm really excited about that. I think we've got on the product front, a lot of new iterations and products that we're launching within our brands to flesh out the line in the context of starting to build a broader consumer brand in some of our businesses and then just improving quality and functionality of some of the products that we've acquired often in partnership with the founder on those. So that's really great. And then operationally, I think everybody in the space is interested in what's going to happen with supply chain. We have the point of view that it's going to continue to look a lot like what it does today for a while. And so we've spent a ton of time and energy and built a lot of relationships and tools to be successful in that environment. So continuing to optimize that so that we can flow product more effectively, have it in stock for customers when and where they want it, and deliver that with predictable quality and economics that our business needs. So I think a lot of exciting things just in terms of scale and what's being added our brand portfolio and starting to extend and expand product offerings within our businesses, and then continue to optimize on the real side of the business, which is supply chain. So Alaina, I'm sure you have more fun comments on the branding side.
Alaina: I think with the scale, we're focused on becoming more and more efficient wherever we can, but then also never compromising the integrity of the brand and not losing that brand magic. You can't over operationalize it to the point where you've lost what makes the brand special in the first place. And so, as we grow and as we bring on more brands, making sure that we have a really streamlined, super- efficient, super- fast, quick to the finish line process, but always maintaining that integrity of the brand, always continuing to focus first and foremost on the experience and the stories that we're telling, and then building deeper relationships with our customers. Tactically, that means building our customer sets, but really making sure that we in tune with who our customers are, what they want, listening really closely to their feedback, having them inform our product development process, having them inform, in some cases, we have a brand where we work really closely with parents in product development to actually get their feedback so that we can adjust along the way. So really taking that relationship very seriously and continuing to weave a very close relationship with our customers. And then just testing, like you said, we should all be listening to data, we should all be driven by data. And so making sure that everything that we're doing is structured in a really rigorous way and that it's set up to be a test, and that at the other side, we have learnings. And that I would say is really a lot of the focus going into this year, is doing really exciting, big things, but then making sure on the other side of it that we have a really insightful takeaway in learning that can then be applied to the whole portfolio. So it's fun and it's exciting. And as we bring on all these new brands, it's been really exciting to see the overlap and the things that we can learn and apply across to other brands. And then also the new challenges that comes with each one. So it's been really fun. And we're just excited to see what the year brings. I think that coming into this year, we have a much bigger team, we have a totally different setup and structure. And so I think we're in just very different place. When I joined last year, we were still very much in the early days, and so it's really exciting going into this year and seeing how much the space has evolved and feeling really good about where we're at.
Ryan Cramer: That's amazing.
Andrew Savage: And I think the thing that I'm the most excited about is I think we'll bring many more great people into the fold and into the single family, whether it's on our team or founders that we're working with. So just my plug here at the end is, if you run an Amazon or a D2C business and you're product obsessed, you're very thoughtful about your brand, and you're looking for an enterprise level partner to help you scale that and get that out into the world and into the hands of our customers, we want to talk to you. You can find us through our website, sumabrands.com. And then if you're a person who is passionate about brand building and products and retail and customers, and you like to be scrappy and test and learn, and figure out how things work, and you want to build, come join our team. We've got a lot of, a lot of openings and we're always looking for more of the right people to bring out to the team. So we'd love to talk to you too. You can also find out more about that on our website. And then you can reach out to either of us directly, I'm andrew @ simonbrands. com, Alaina is alaina @ sumabrands.com, but we're always happy to hear from people out in the world. So don't hesitate to do that.
Ryan Cramer: Man, you stole my thunder at the end. It's important, I had to keep people up and like, " Hey, make sure we talk about how we can get in touch with you." But everyone. I'm glad I had this all queued up and ready to go. I'm following Andrew today.
Andrew Savage: Have we gotten any comments about like walk in socks?
Ryan Cramer: Honestly no. I think people are taking notes, but that's okay. People will watch us later on. They're either on Snow Day today and it's Friday, but they know, it's walk in socks. This is a question that we're going to have to really highlight in our highlight section on blog, I guess make a lot more people.
Andrew Savage: I got to be honest, it would really make my day to get a random email from somebody who was listening with like, " Hey, I thought I'm on my walk in sock and this is it."
Ryan Cramer: Absolutely. I need to think more about this too. It's definitely a personality test. That would be a good interview question, maybe.
Alaina: It is, it is.
Ryan Cramer: Again, creative aspects.
Alaina: Yeah. Talk about personal branding, that's the encapsulation of your manifesto and your person. It feels so high pressure. I don't know if I could get down to just one, it feels too high pressure.
Andrew Savage: I think it's cut of for an interview, make sure you arrive with your walk- in socks, you all will be ready.
Ryan Cramer: Don't even go on camera yet, you have to play that before you turn on camera. That will set the preface too if you get a second call back or not, but that'd be good. My other question that I think I always say is the weirdest one coming into an interview of a video artist. If there is an elephant that appeared in your line, what would happen and what would you do? Again, random. It's just one of those things that I don't get that engagement too much, but that was certainly nothing applied to whatever that company was. It was just, what would you do if that happened? I'd be like, " Well, this would be a dangerous thing because I'm in Southern Indiana." I'd lose that, I don't know. What do you want me to say? Exactly. But for both of you, thank you so much for hopping on today. I know that there's so much advice and so many opportunities for people to exit their brain. But I think this is something unique that you guys have put a flag in the ground, if you will and said, " Hey, this is who we are. We're putting brain focused and forward messaging together. Don't need to be flashy, but we need to. What we're doing is helping people understand, take it to the next level." And I think success is going to be big for you guys in the future. So thank you for hopping on Crossover Commerce today. I always say, friends of the show, now you're more than welcome to come back into my corner of the internet, to talk on anything that you might have learned or seen in the space. Are you guys going to be at any shows or are we going to see you guys in expos or anything like that this year?
Andrew Savage: Yeah. We're still making plans, but we'll be out there in present. So maybe we could connect live. That'd be cool.
Ryan Cramer: Yeah. Are you going to be at Prosper or is that a still TBD.
Andrew Savage: We'll be at Prosper.
Ryan Cramer: Okay, perfect. We'll have to connect there. It's coming up quickly.
Andrew Savage: Yeah, I know.
Ryan Cramer: Wonderful. Thank you so much, Andrew and Alaina, if you guys stick right there, we'll make sure we just cap off show off air. And thank you so much for hopping on our Crossover Commerce. So thanks again for coming on today.
Andrew Savage: Thanks Ryan. Great to be here.
Ryan Cramer: Awesome. And thank you everyone who was tuning in live on episode. I'm going to get this back up here, 214 of Crossover Commerce. Again, this is my corner of the internet called Crossover Commerce. If you're new to the space, go ahead and follow PingPong Payments on social media, whether it be on Facebook, LinkedIn, YouTube, or Twitter or myself, you can follow on most social media channels. Best way to do that is on LinkedIn, just search Ryan Cramer. And of course, follow us on all your favorite podcasts destinations, that can be on Apple, Google, Amazon Music. We're on all the major platforms. So once audio version's come out, you can check those out, or of course, go to usa. pingpongx. com/ podcast for all the videos and transcripts of every episode. No one ever thinks if they want to read back and we can look back at highlights and guests, but you get that on our website. So make sure you check out that. All the links to follow our guests as always will be in every episode. That being said, happy Friday everyone, we'll catch you guys next week. We have more episodes coming your way. We have great people from First Choice Shipping as well as Marketing by Emma coming up next week. Friends of the show as always coming back to talk about sourcing and logistics, but also more about optimizing your listing. Talked with Emma yesterday, she's really excited about coming back on. So that being said, we'll catch you guys next time on another episode of Crossover Commerce. Take care.
Ryan Cramer of Crossover Commerce talks with Andrew Savage and Alaina Andreozzi of Suma Brands, discussing how they approach branding, marketing, and omnichannel.
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