Our Top 12 Plays of 2023

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TLDR;

- The TLDR; Newsletter of all our newsletters so far.

- 12 Out of the Box Growth Strategies for your Biz

LBAB Community:

In 2023 y’all have read through 46 newsletters, 29 Brand Teardowns, 10s of thousands of words, over 130 “plays,” and P&Ls as far as the eye can “DTC,”

Now most of the 3,121 eCom-heads reading this have recently joined us on this incredible journey of reimagining our growth through the eyes of what’s potential for other brands.

If you just joined, missed any weeks, or need a refresher… Today, we’re bringing you the creme de la creme of all our sends.

We combed through those 29 Teardowns to bring you the best 12 Growth Plays we came up with last year. But you know we have to bring more value than that!

If you want to see the Financial P&Ls for these bizs check out the Let’s Buy a Biz! Tracker here. 

We also curated the best examples from the newsletter of how brands would implement these plays in their biz. Some are already doing it. For others we’d like to see them implement it.

Now the full blown Report is 21 Google doc pages so we can’t host it all here. So today’s newsletter is we’re trying something new.

Below in the newsletter you’re going to see the summary level of the report [Click here if you want to full goods].

For the Skimmers:

1. The concept + Explanation of the play.

2. Ex. Brands that are/could implement the play.

3. The Highlevel Insight/Takeaway.

For those that want the full insight:

1. Same as above +

2. Full in-depth coverage on how the brands would implement 

3. How to think through the strategy

We hope you enjoy! Let us know what you think.

LBAB!’s 12 Plays of 2023

1) The Multi-Brand, Multi-Segment Playbook

The Play: Brands with subsidiaries in the same vertical can run the same playbook in the same market to two separate segments at the same time.  

Putting the play into action: REVOLVE, Alpargatas (Havaianas & Rothy’s), and potentially FIGS offer the Affordable and the luxury option. [Think Levi’s -> Dockers].

Takeaway: Different audiences require different brands.

2) DTC Customer Insights → B2B Products

The Play: Leverage the data captured from a mass-appeal, consumer-facing application and create B2B products on the back of it.

Putting the play into action: Instacart turned customer shopping data into Ent level brand dashboards. [Think Amazon -> AWS]

Takeaway: Convince bizs you can help sell their products.

3) Learn the Market. Build the Marketplace.

The Play: Turn DTC consumer traffic into a destination where you can monetize those eyeballs in as many ways as possible.

Putting the play into action: Chewy (+ how Smile Direct Club should have built) should buld marketplaces for their B2B channel partners to create the Value add Services -> Leads Flywheel. [Think Credit Cards -> Hotel bookings]

Takeaway:  Create Channel partners by burying them in leads. Let the reciprocity Flywheel turn.

4) Leverage Loss Leaders -> Profit Puppies

The Play: Bring new customers in on unprofitable SKUs; keep them for the super profitable ones.

Putting the play into action: E.L.F. scales loss leaders ($3 lipstick) to the moon -> $50 purchases with upsells. [Think Costo’s $1.50 Hot dog.]

Takeaway: Healthy, focused bizs scale on loss leaders -> a litter of Profit Puppies.

5) Nail, then scale. Thicken your S-curve(s).

The Play: Building around your hero product(s)/categories is the fastest way to increase profitability and has a far greater biz impact than searching for new heroes/categories. 

Putting the play into action: (Chewy) + (Instant Pot + Honest Co.) launch new products to continue their growth to keep the growth momentum going. [Think Apple Launching iPods -> iPhones -> Earbuds]

Takeaway: Do more of what you do best. 

6) Drop Stunt Collabs

The Play: Partner with others brands/influencers/ personalities with the sole intention of driving word of mouth. Answer: How can you get press coverage out of this?. 

Putting the play into action: E.L.F. & Wolverine lean hard into partnerships to capture free eyeballs = CAC Hack. [Think Doritos Locos Tacos]

Takeaway: Enter new markets via collabs to attract new customers. If it works = new product extension + customer base.

7) Turn Customers -> Evangelical Sales reps

The Play: Sell to bizs who will sell your products to their customers. They pay you to sell your product.

Putting the play into action: Olaplex doubles profits from hair stylists (They buy and convince their customers to buy) + how Wayfair should run this play. But it isn’t an MLM. [Think Tupperware parties]

Takeaway: Your invisible payroll will be your most important payroll.

8) Abandon the Verticalize-or-Die Kool-Aid

The Play: Trying to vertically integrate and/or DIY everything is a lie DTC 1.0 told themselves that’s holding us back.

Putting the play into action: Why Smile Direct Club should have been the provider for Orthodontists, not be the Orthodontists + and why Rent the Runway needs to rent laundromats, not be a laundromat. [Think Farmers don’t own Grocery Stores]

Takeaway: DTC-Only mania is dead. Verticalization needs to be, too.

9) Kill the sidequests

The Play: If it doesn’t fit the core biz, get rid of it. 

Putting the play into action: Amyris (went bankrupt) overextended their biz into too many areas: Heavy R&D Launching brands, Launching Celebrity brands, Operating DTC + Retail vs. 1 killer biz model & focus. [Think Zippo Perfume - Yea the lighter biz. 👈 a real thing]

Takeaway: Do what you do best. Rip out what pulls you from that path. 

10) Don’t Miss the Boat on Omnichannel

The Play: DTC is a step on the biz staircase. To continue to be great, brands need to leverage retailers who have customers and massive operational systems already in place.

Putting the play into action: Allbirds can fly again + AKA Brands needs to go into mass retail, not owned retail to build enduring brands. [Think Nike].

 Takeaway: Leverage Mass Retail’s massive infrastructure to kick off a decadeslong growth horizon.

11) Avoid Inventory Capital with the “Guide Shop”

The Play: Try on in-store, ship DTC. Help customers get exactly what they want on the first purchase. No in-store sellable inventory.

Putting the play into action: Brilliant Earth can reduce stress around ring shopping by investing in the “Ring Guide Shop:” [Think Bonobos or Tesla]

Takeaway: Owned retail can be valuable if executed thoughtfully… And with less capital-intensive investments.

12) Own a Habit. Own Their Wallet.

The Play: Find customers’ deep daily habit. Find every product they’ll need. Selling more to the same customers = The name of the game

Putting this play into action: Barkbox owns your Pet budget because they dominate the delivery box. Embed in a habit the rest is history. [Think Starbucks]

Takeaway: Repeat Rev = The goal.

Final Thought:

The three most important themes among these plays are also guideposts for all of eCom (and all biz, for that matter). 

1. Sell more to the same customer: If there is one law of biz, it’s this. Regardless of how a biz does it, the end goal is to increase Revenue and profits per customer.

2. Focus on Core Excellence: The biz that lacks focus, and conviction is the biz that doesn’t see tomorrow.

3. Patience in Building real brands: It might be the lore of SaaSicorns going from 0 to $5B in 5 years invading our space, but in eCom, brands that last are not (much like Rome) built in a day.