#128. Recess is a CBD-infused beverage company. We talk with founder and CEO Ben Witte about how he set out to dominate the CBD category through a superior product offering and distinct marketing approach. The Megaphone Podcast features marketers, analysts and advertising professionals navigating the roller coaster ride of building a 21st-century brand. 

Check out the full transcript below. 

Ben: [00:00:01] I think of distribution as marketing. It’s not just sales. And so, that’s why I was like, “We want to be high-level, not just high.” Just because you’re in Soho House, so what? Right? You want to be at Soho House and the bodega. If your brand’s strong enough, it can exist in both.

Richie: [00:00:15] That’s Ben Witte, founder of Recess, a CBD-infused beverage brand. Ben started the company after seeing the potential of bringing CBD to products consumed every day, along with the opportunity to stand out with a distinct brand and marketing approach in a category built on exactly that.

Richie: [00:00:30] I’m Richie Siegel, the founder of Loose Threads, which analyzes and advises next-generation consumer companies, and FaceLift by Loose Threads, a retail incubator and accelerator for leading brands and retailers. For our latest analysis and insights, check out our free weekly newsletter at LooseThreads.com. We also announced Loose Threads Live, our invite-only and entirely off-the-record gathering for founders, executives and investors, on October 3rd in New York City. Learn more at LooseThreads.com/Live.

Richie: [00:00:55] I started the Megaphone Podcast to talk with the marketers, analysts and advertising professionals navigating the roller coaster ride of building a consumer brand in the 21st century. That’s why I was excited to talk with Ben about the strategy behind his ambitious plan to dominate the CBD category, one pastel-colored can at a time. Here’s how he’s doing it.

Ben: [00:01:21] I actually saw CBD added to another drink that was positioned more as, like, a plant drink but, immediately a light bulb went off. And I’m like, “This is gonna be an ingredient, similar to caffeine, that’s gonna be added to a beverage, and there’ll be a new category formed.” Most importantly, I was attracted to the value proposition of CBD because I’ve always been a naturally kind of wired, hyper-anxious, ADD-like person. And I was familiar with cannabis, had smoked marijuana like, off and on for a while, but had never really experimented with specifically CBD. But I was familiar with what it was. And so, when I sought out it to drink, I immediately kind of went down the rabbit hole, began to experiment with CBD as well as adaptogenic herbs myself, to see how I would feel when I started using them regularly. And when that happened I just felt significantly better. I felt more balanced, more even-keeled. And, as a result, I felt more productive, more creative and less stressed out and anxious.

Ben: [00:02:25] I think stress and anxiety are one of the biggest issues of the 21st century. I see this anxiety economy forming—I didn’t come up with that term, but I think it’s a very good term—and the way I see it is you have things that are consuming your body, as well as lifestyle choices. So things that are consuming now would be marijuana, CBD, nootropics, adaptogens, medical things like Xanax. Opioids would be even [an] example of something that I think is in reaction to [a] rise in various types of anxiety, as well as lifestyle choices like mindfulness, yoga, meditation, time well spent, Marie Kondo. These are all indicators that people, one, are acknowledging, you know, mental health and their anxiety, and are increasingly actively searching for solutions in brands now, to help them take back control of their lives.

Ben: [00:03:20] But the way to think about CBD is [as] a compound no different than caffeine or whey protein. It’s gonna be something that’s added to everything and the value is going to be in creating the right formulas and applications. So, [it] could be a beverage, could be a dissolvable tablet, could be added to beauty. It’s going to be added to everything, for better or worse, I believe. And then, most importantly, building the brand on top of it. You’d want to market the solution and not the ingredient. That was a key insight here.

Richie: [00:03:49] Did you know that early on?

Ben: [00:03:51] Yeah. To me, I was like, “This category is gonna be as big as energy drinks.” Every person on the planet needs energy, naturally or through stimulants of some kind. Coffee, energy drinks or other. Not everyone needs kombucha. But I think what we’re offering, this idea of balance, is a universal value proposition just like energy is, and people don’t know they need it right now, but they want it. And there’s an opportunity to kind of create a brand and tell a story around this idea. And that, if you look at Red Bull and Monster, they don’t call it the “caffeine category,” they call it the “energy category.” It’s all about the feeling that CBD enables, and that’s inspired the tagline, “Calm, cool, collected.”

Ben: [00:04:31] And so, I don’t think of Recess as a CBD company. It’s an ingredient that enables the biggest idea. I think we can be the biggest CBD company without ever marketing, gleaning too far into marketing the CBD, ’cause I actually don’t think consumers really care about it. I don’t think consumers want to hear fifty facts about hemp all day. They want to know how they’re gonna feel and how they’re gonna use it, and the lifestyle around it. So that was very clear to us from day one. So that was a key insight.

Ben: [00:04:57] Another one was the go-to-market for a beverage and CPG company is shifting. Like, one of my frameworks I like to use is, in the past  perimeters were built on the shelf—today they’re built on your phone, and that changes everything. Well, one of the reasons they’re gonna be built on your phone increasingly is because the distribution model is gonna increasingly be on the channel.

Ben: [00:05:15] So, I think there is this complete misconception about Recess, is that we were a D2C brand. I’ve never viewed us as a D2C brand, but we intentionally launched online-only, off-our-website only, for a couple reasons. The first is that I wanted consumers’ first interaction with the brand to be our website and our Instagram, ’cause that’s what kind of conveys the emotion and the mission and purpose and what we want you to feel. And the second is that we wanted to kind of create the buzz and the leverage online to go offline. So, I could have met with all these distributors, all these retailers before I launched, but I was like, “They get pitched by thousands of brands every day. How are they supposed to separate the signal from the noise here?” I want them to come to me and I have them come to me by building an incredible amount of buzz online, and that just happened a lot better than I thought it would, right?

Ben: [00:06:02] So, until the middle of January, the company was based in my apartment. We launched just a little over eight months ago, at this point. When we launched it was me and my COO who I brought in, you know, when I was ready to kind of commercialize the business. He was the only person I knew that ever worked in CPG, so I called him from like, the early days, and brought him on as an adviser. And then when I was ready to kind of commercialize the business, he came on full-time as my COO. And we did 40 times our first month’s projected sales. We had like, 5,000 back orders after six weeks, and we were like, “Okay, we have product-market fit. We clearly have a brand and a product that people love and are deeply connected to and retailers and distributors wanted.” Our supply chain was not remotely prepared to meet the demand. And so it immediately went from, is this gonna work to it working significantly better than we expected. I think we were a little overly conservative. And then I was kind of off to the races.

Richie: [00:07:05] So, why don’t we go backwards a bit? You had all these personal experiences that led to a number those insights. Where did you, I guess, go from there to get to launch, in terms of brand, product, marketing, etc.?

Ben: [00:07:17] I started work on the brand even before the product. So we had the idea, CBD sparkling water. We were like, “Okay we want to do a beverage. Like, where do we want to enter the space?” You know, to us, sparkling water was obvious, because it’s like the fastest growing category in beverage, because people want something that’s carbonated, has like, the feel of drinking a soda without the sugar and the calories. So that’s where we wanted to start. But I ended up calling Emmett at Gin Lane before we even started working on the formula, and I was like, “Yo, like, we’re gonna do this. Do you want to work with us on the brand?”

Ben: [00:07:48] And so I worked with Gin Lane on the initial brand identity. So, naming, I’d say, the brand essence and some of the initial packaging, kind of concepting and direction. Because we had some of these key insights you know already in our heads around balance, not relaxation, for example. So, one thing is we have never used the word “relax” in any of our marketing, even though the average consumer would probably describe CBD as relaxing. But the way we thought about that is like, people don’t aspire to relax. You aspire to feel kind of balanced and centered. If you tell someone to relax that’s like an insult.

Ben: [00:08:23] And so, what I thought Gin Lane was so excellent at in being kind of collaborators is really helping us kind of arrive at the brand essence, right? The naming, it was one of those things, that was a part of our engagement with them, and they put kind of 50 on the board, and it was just clear. Like, that was the right first one. And then on the packaging, you know, there was [a] debate— are we gonna do white cans or pastel cans? I had a very clear idea that I wanted to create like, a “Recess World” that transported you. But what happened was the brand got so far ahead of the product, because we hadn’t formulated it. I didn’t even know how to make a beverage or formula.

Ben: [00:09:03] And so, I literally went on Google and found the biggest beverage formulation company that worked with companies like Starbucks and Dr. Pepper to do their formulation. And I spent all this time convincing them to work with us, because CBD was a controlled substance at the time. They weren’t even gonna be able to use the product, like CBD, in their lab. [I] started working with them and just really quickly recognized they were too corporate for how I wanted to work. I’m a guy that likes to be in the lab working on the formula, and so I ended up firing them. And then basically hired, just through a friend, this guy named Jason up in the Hudson Valley in Beacon, New York, who had a syrup company. And I ended up meeting him like, “You know how to make flavors? Like, do you wanna like, work on this drink with me?” And we came to an agreement, and I end up taking the train up to the Hudson Valley every weekend for like six months and working on this formula.

Ben: [00:09:57] And, at the time, there was no concept of water-soluble CBD, ’cause CBD oil wouldn’t dissolve in water, right? So there’s a lot of work and time it took to figure out how do you get a CBD supplier to create a formula that would dissolve in water. And all the while, like, the CBD supply chain/ecosystem was building and building and building. And so, from when we started working on the idea to where we are today—which is like, I guess, probably close to two years at this point—it’s just, the entire ecosystem exploded, and it was, you know, such an obvious application for CBD to be added to food and beverages that it made sense that there would be various suppliers that would create those specific applications.

Ben: [00:10:43] So we had to pause the engagement with Gin Lane so I could finish the drink, ‘cause there was nothing to market. Like, it didn’t even exist. We didn’t have flavors, we didn’t have—we didn’t have much. I knew I didn’t want it to be above five grams of sugar; it didn’t have to be zero, but I wanted [it] to feel guilt-free. I didn’t want it to be that much above 20 calories, I didn’t want it to be above four or five dollars. The reason it has to be expensive is because the cost of CBD is very expensive right now, because it’s being supply-constrained, because it’s been a controlled substance. And I knew I wanted it to be shelf-stable—so, not having to be kept refrigerated—and I knew I wanted to be in cans. Right. And so then I had to kind of create a formula around that.

Ben: [00:11:23] I also wanted it to taste distinct and unique. Like, I think the best comp for Recess in beverage is Red Bull. Red Bull doesn’t even taste good, right? And there’s all this like, if you go back to the history of it, people didn’t even like how it tasted. But it tasted like it was doing something the thing was supposed to do, right? It kind of tasted like rocket fuel. And so I think it was important that Recess, it is a sparkling water, it’s very much its own thing. Like, Recess doesn’t taste like LaCroix or Spindrift. Like, it tastes like Recess. And I think there’s a lot of value in that. And I think I wanted it to taste like it’s doing something, so like, it has a bite to it, which is by design.

Richie: [00:12:00] How would you verbally describe the taste?

Ben: [00:12:02] More like a sparkling iced tea or sparkling, light kombucha. It almost has like a tea/kombucha component to it.

Richie: [00:12:09] So you were formulating, then you paused the Gin Lane engagement, and then came back.

Ben: [00:12:14] Yep. So what happened was, when I was ready to commercialize the product—including finish the packaging, the brand and everything related to it—I ended up finding two kind of freelancers and we worked out of our various apartments for months to create what you see now. The studio is now named Day Job. They have close to ten people like, say, a real agency they’ve built with kind of Recess as the anchor client.

Ben: [00:12:39] We then worked with a group called The Couch, and this guy Costa to create the web experience. But if you look at the Recess brand compared to anything else in CPG, it’s just so, so, so, so different. I’ve never thought of Recess as just a beverage brand. Once we kind of had the name Recess, the big idea of Recess is the idea of Recess itself, which is taking a moment throughout your day to reset and re-balance. And, given that to succeed in beverage you had to succeed in brand marketing, I wanted to lean in to kind of content and experiential marketing.

Ben: [00:13:14] And so, another key insight on the brand was, I saw an opportunity to focus on creatives, because I was one, and I found them to be kind of an under-tapped market. And like, Instagram, which is where I think culture is made today, despite their influence. So, just like Red Bull built their brand focused on the action sports community, to create the association of having a Red Bull and getting stimulated, and Gatorade focused on the traditional athletics to create the association with like fitness, recovery, and Gatorade, I wanted to focus on the creative class, as I describe it. So, music, fashion, art, design, internet culture, that’s who we wanted our content to kind of speak to directly, and that’s what we’ve done.

Ben: [00:13:58] One of the things I believe is that the value proposition of Recess is literally universal, just like it is for coffee and energy drinks, but your content strategy has to be very kind of targeted. If you’re trying to speak to everyone, you’re speaking to no one. There’s so many different kind of channels Recess is playing in, and each has to have a very specific kind of communication strategy. But, as it relates to content, I wanted to focus on kind of creatives and, to start, just like, designers. If you look at like, our Instagram, which is the primary thing we’ve done, it’s very much kind of speaking to designers, and over time you’ll see us kind of expand that a lot more.

Richie: [00:14:41] Talk about, I guess, the launch. What was the plan, how did you set up for it and kind of, what were the expectations going in, which you alluded to a bit before?

Ben: [00:14:47] Yeah. So I knew I wanted to do a PR launch and just focus on Instagram. Until about a month ago we hadn’t spent any money on paid advertising, it was just organic Instagram content and PR. And the thinking behind PR was that everyone was talking about CBD but no one had a narrative. We had a strong narrative and visual identity that would lend itself well to press, and that it’s all about awareness. It’s all about awareness, it’s all about buzz. It’s important almost seem bigger than you were.

Ben: [00:15:20] Like, when we launched the brand, it was so polished. Our website was extremely slick and smooth and like, distinct, and I wanted Recess to feel somewhat inevitable. Like, Recess is gonna exist in the world, I know that. Like, it should exist, right? That’s not true of a lot of CPG brands. It’s really important to understand like, in the category that your startup’s operating in, what is your key equation? And in beverage it’s pretty obvious to me that it comes down to marketing. There’s gonna be multiple CBD beverage brands. They’re gonna get on the same shelves, just like you walk into a grocery store, there’s a couple of different energy drinks, a couple different kombuchas. And you end up competing on marketing—price, promotion, and brand marketing and just, demand. The most important thing in this modern day world is generating earned media, right?

Ben: [00:16:09] And so, I think the key metric in beverage is generating the lowest cost per impactful ad brand impression, and the best way to do that is to generate earned media. And the best way to generate earned media is to create content and experiences that people want to deeply engage with and share. And that’s not facts about hemp, right? That’s like, funny, kind of meme-inspired content on Instagram. That’s events.

Ben: [00:16:33] After Instagram and PR, the next thing we did was launch Recess IRL, which is our retail experience in lower Manhattan. And the original inspiration behind that was that the company was based in my apartment and we like, needed an office. I was like, “There’s all this empty retail, ground-floor retail. What if we put our office in the back and did a, some type of like, activation up front that felt like you were walking into our Instagram, or the feeling we want you to feel when you drink a Recess?” It’s really a feeling, and so that’s what I really think we’re doing, we’re designing feelings.

Ben: [00:17:09] I woke up one morning and I called my friend Fritz, who is my younger brother’s best friend [from] college, who’s kind of an interior designer and carpenter. And I was like, “Yo, do you want to build this space with me? Like, I wanna go create a Recess space.” The company kept just moving faster and faster, and we just concluded like, this space we decided to move into, there wouldn’t be enough room for our office. We’re like, “We’re just doing a whole thing.” And we created this entire kind of Recess world in a space, and it was designed to serve a few purposes.

Ben: [00:17:40] The first was, again, I wanted to create this space that felt like you were walking into the feeling I want you to be feeling when you drink a can of Recess. The second was, I wanted to provide a space in downtown Manhattan that allowed you to take a Recess, so the back half of it is this kind of dimly lit, blue lit space that kind of feels like you’re walking into a James Turrell exhibit. We designed these chairs which are very interesting that could serve a bunch of different purposes, and you can lay on them a number of different ways.

Ben: [00:18:08] And then I wanted to create a space for the creative community in New York to be able to host events together. And we’re very much a collaboration-driven brand, so we collaborate with brands and creators to create content and experiences, and that just ended up working better than we could have ever expected. You know, we’ve held probably an average of three to four events a week for like eight months at that space. And the least important purpose of the space is sales. We actually do a decent amount of sales out there, but that’s not why we did it. So Recess IRL is gonna become like, an entire leg of the business, we think. And we’re figuring out what that will be long-term, but there will definitely be additional Recess IRL locations opening.

Richie: [00:18:53] You started a line intentionally selling direct-to-consumer with the goal of expanding into more traditional distribution. I guess, talk about how that unfolded, in a sense, in terms of what caused what and like, where you started to spend your time, and how they work together, contradict, etc.?

Ben: [00:19:10] Well, to me it was just obvious that direct-to-consumer beverage makes no sense, because people are thirsty wherever they are, whether they’re at work, they’re at home, they’re at the gas station, they’re at a bar, they’re at a restaurant. And if you have a successful beverage brand that people want, your goal should be to be everywhere, right? So it was always the vision to be as omnichannel to the extreme. That was very clear from day one.

Ben: [00:19:36] So, when we came to the idea, CBD was still a controlled substance, and the law effectively viewed hemp and marijuana as the same thing, when in reality they’re cousins within the cannabis family, with one critical difference: hemp doesn’t have THC. And so, what happened was, the first state to implement a hemp cultivation pilot program was Kentucky, which was Mitch McConnell’s state. And what he saw was farmers that used to grow like, tobacco and corn and soybeans, transitioned to hemp, and that was a much higher-yielding crop. And so, he introduced this piece of legislation right around the time we just came out with the idea called The Hemp Farming Act, and it accomplished two things: it allows all 50 states to cultivate hemp, and removed CBD from the controlled substance list, shifting the regulation from the DEA to the FDA.

Ben: [00:20:31] But, again, at the time that was not a guaranteed thing that was gonna pass. And so, when we decided to move forward on this idea, I was basically betting my life on the fact that this would pass, because like, you’re not gonna build a business indefinitely selling a controlled substance, right? But some of the best businesses ever built happen when there’s a regulatory change. There’s a misconception that, as soon as The Hemp Farming Act passed, all the regulatory issues would go away, and it was just like, the beginning of another set of issues, basically. And the reason that was is because the regulatory oversight of hemp and its uses shifted from the DEA to the FDA, and the FDA is all about permissible ingredients in food and beverages, how you label them, how you’re able to market them. And that there would be a process, which we’re still going through, that would basically present a formal set of regulations, and that the business plan of Recess was, by definition, to navigate this complex and fluid regulatory environment to arrive on the other side as the category-defining brand. And the way I’ve thought about that is, the objective of Recess since we launched is to be the default first choice for a retailer or distributor looking to launch this category. Which we are, at this point.

Ben: [00:21:43] In some ways, the game hasn’t even begun. It feels like CBD’s everywhere, but it’s actually nowhere. So Whole Foods, Target, Walmart, 7-Eleven, Trader Joe’s, etc., they don’t carry CBD. Trust me: they all want to, and they’re about to. And so, the business plan was to just continue to create the buzz and the awareness, and get the initial distribution in the independent accounts in the key markets, so that when the FDA says, “This is what we’re doing,” Recess is ready to scale massively.

Ben: [00:22:11] Working backwards from what I was like, solving for, it was that. And so, you know after a few weeks it was like, “All right, we have a product that people want. We’ve got to get this on the shelves in New York City,” which is where, you know, I’m based. So we first started really distributing out of my apartment. Like, doing self-distribution, hired a sales rep, and we just went door to door and started doing it ourselves. And then we ended up signing with this group called Big Geyser. They are the largest independent beverage distributor in the country. They kind of focus exclusively on the New York metro market, but they are responsible for building brands like Vitamin Water, Smart Water, Monster Energy, Core, Essentia, all in New York. And so, they’re legends in the industry. And they ended up coming in as strategic partners in the business, as both our distributor and a significant investor.

Ben: [00:22:59] And we’ve kind of built the brand in New York together. And I have, at this point, like six sales reps just in New York City alone that work with Big Geyser to build the brand. We have over 2,000 accounts in the New York metro market. The next market we just launched was Southern California, it’s doing extremely well there. No other beverage brand that I can think of outside of Coca-Cola and water works in as many different consumption occasions and, as a result, as many different types of retailers, right? And so, if you think about your total addressable market for a beverage, well, it’s a combination of those two things, right? Like, Red Bull is very limited, LaCroix is very limited. They’re not gonna serve a LaCroix at the Waldorf Astoria in Beverly Hills where they serve Recess. So we’re in everywhere from every bodega in New York to gas stations all throughout Southern California to the Waldorf Astoria and Surf Lodge, right? And so, one of the beautiful things about Recess is just like, how big of an idea it is, right? And that the different ways people are looking to take a Recess.

Richie: [00:23:59] One of the interesting, I guess, points there is the like, high/low juxtaposition, in a sense. Some brands—and part of this is, of course, driven by price, so that we can talk about—would want to stay with the specialty higher-end retailers for a very long time, use that to build the brand and so forth. By being in 2,000 points of distribution in New York alone, you took a very different approach. What was the thought behind it, and why do you think it worked? And that you didn’t need to like, go slower with higher-end to get where you wanted to go?

Ben: [00:24:29] Beverage, in particular, is all about awareness, and because Recess is on many, many, many shelves in New York, it’s the idea of Recess just being marketed to people every day, even if they don’t buy at that moment. And the second is that, if your brand is strong enough, it can exist on its own. I always think about this and like, the D2C debate about Amazon. Everyone’s like, “Oh, I don’t get the customer data, so I can’t be on Amazon.” Like, are you kidding me? Like, the benefits of establishing your brand awareness on Amazon outweigh most of the costs there. And I think feeling big and feeling like you’re everywhere and inevitable is so much more valuable than people think.

Richie: [00:25:08] To you, it’s more valuable than being, you know, high-end in a few places.

Ben: [00:25:13] I’ll say this: the most important startup advice is there is no generic startup advice, right? So beverage is a very unique category because of the number of places it makes sense to be sold and consumed.

Richie: [00:25:21] But for this category, for you, yeah.

Ben: [00:25:22] For Recess. So I was like, you want to feel like you’re everywhere. Like it’s—that was very much in my design. I want Recess to feel like it’s everywhere, I want it to always be. We’re a buzz company, everything we do is designed to create buzz. And distribution’s a point of that. And so, I think a distribution as marketing. It’s not just sales, it’s also marketing. And so that’s why I was like, “We want to be high-low, not just high.” Just because you’re in Soho House, so what? Right? You want to be at Soho House and the bodega. And if your brand’s strong enough it can exist in both.

Richie: [00:25:51] Talk about price a bit, in terms of, obviously, you gotta hit certain numbers to make all this work to get that wide distribution. What was it like kind of figuring that out? And how did you price it accordingly?

Ben: [00:26:02] Yeah. Because of the way beverage distribution works—you got your distributor, you have your retailer, and everyone’s taking some margin, right? So you have to kind of work backwards from like, what are my cogs, and then what is the distribution model I’m going to take? And if you’re direct-to-consumer that’s gonna have its own set of costs. Like, just shipping and acquiring customers online versus working with distributors and retailers. And so, there were just certain realities you had to operate in on both the cogs level and your retail price point level. Which, basically what I do. Like, you’re gonna be playing in the premium beverage space. You’re not gonna be competing with LaCroix on price.

Richie: [00:26:40] Which is, what, a dollar?

Ben: [00:26:42] Fifty cents to a dollar, depending on where you are. And so, you know, I felt like, you don’t want to be above five, though. Because it’s a can. We’re also like, the first non-alcoholic premium can, without a doubt. You know, the highest price point for a canned beverage that’s really worked, but it has such a kind of premium look and feel to it. So, I was like, “If you’re gonna compete at that part of the beverage category, in the premium category, in a can, well, that brand better like, pop and stand out on its own.” So I want to bring the price down over time, for sure.

Richie: [00:27:14] What is it now?

Ben: [00:27:15] $4.99 at retail, typically. But it’s also something that people value and want, and so I think people are willing to pay for things that they have a connection to that makes them feel better.

Richie: [00:27:25] There are a lot of similarities from a marketing perspective between everything you’ve talked about, and I think a lot of the way that Glossier’s built their company. The largest difference is distribution. They are zero percent wholesale, 100% owned. You’re not fully the opposite, but have a pretty big stake in the ground that wholesale traditional distribution is gonna be a big part of what you all do and what makes you who you are.

Richie: [00:27:49] I guess, two parts to the question. One, do you think they could have done what they did the way you’re distributing? And then, vice versa to you. Not like, why did you choose not to do it their way but what would have happened if you tried it their way. Does that make sense?

Ben: [00:28:04] Yeah. Totally. So, I’d say Glossier is my favorite brand. I think they do everything exactly the right way and I’ve been very inspired by everything they’ve done. They started with content and then built products, and then now it’s this content-commerce intersection. I think they have a very clear mission and purpose and a very clear community that they’re cultivating. So I’m very inspired by Glossier. I’d say there’s just one key difference, and that’s that we have a single-use product that you have the potential to want to buy multiple times a day, you’re not gonna buy Glossier multiple times a day. You could use it multiple times a day but you’re gonna carry it in your purse or keep it at home.

Ben: [00:28:37] So, again the most powerful part of Recess that inspires everything we do is the potential for the frequency of use and purchase. The other point is that this is just the first product line we’re doing; there will be many, many, many types of Recess that we continue to create that you consume. So, different types of ready-to-drink beverages, supplements, you name it, like, we can do it. And so, that’s the difference. We want to be everywhere, just so, if they want a Recess they can take one.

Richie: [00:29:02] Right. But, technically, future product lines that maybe don’t have a single-use consumption could look closer to them from a distribution perspective than what this does.

Ben: [00:29:10] Yeah. Like, for sure. Like, you know, merchandise is gonna be something we go into in a big way…

Richie: [00:29:14] But, I assume, direct.

Ben: [00:29:16] Yeah, direct. But hypothetically it’s like, if one of the purposes of the merchandise is to continue to create awareness for the brand, if it’s in a boutique, that’s great, right? It comes down to like, the digitally-native-brand-versus-D2C debate. Like, I think we’re a digitally native brand, not a D2C company. I’m not saying that makes sense for everyone but, for the dynamics of this category, it’s clear to me that that’s right.

Richie: [00:29:37] What do you think kind of will go wrong, can go wrong, and/or what keeps you up at night?

Ben: [00:29:42] Because of our strategy, which is extremely omnichannel in nature, because of just how much I think we have the ability to do, it ends up being a resource allocation game, and that resource is our time, people and money. And like, all right, how much are we gonna be investing in opening San Francisco versus LA versus Boston? How many dollars are going towards traditional field marketing, which is like, demos and cans-in-hands, versus culture marketing, versus content marketing? Those types of questions. How do you prioritize different markets? How do you prioritize product line expansion? Like, it feels like everyone knows Recess but no one knows Recess. In the grand scheme of things, well, if you have five different product lines, that can be confusing, right? So I think it’s really like, a cadence to do all these things. Like, I have big aspirations for what I think this brand can become, with the beverage being a huge opportunity, but just one part of that.

Richie: [00:30:40] Yeah. Do you still have to do like, table-in-a-grocery-store sample stuff?

Ben: [00:30:46] M-hmm. Yup. Because the grocery stores want it. And, again, we’re gonna be in 50 markets in multiple countries, right? Like, eventually, right? So, yeah. When you’re working with these distributors and these retailers, they want to feel supported, and they also want to know that you’re gonna drive the awareness. So when someone goes in a grocery store they know what it is. But you got to do everything.

Ben: [00:31:03] It’s interesting from a culture perspective, ’cause there’s so many different types of people that work at Recess, right? You have the brand itself, you have Recess IRL, you have manufacturing and formulating Recess, and, you know, future versions of Recess. You have traditional sales organization. Those are very different types of people. Like, how do you create a consistent culture where everyone’s kind of moving in one direction at the right cadence?

Richie: [00:31:27] What are the next, I guess, six-to-twelve months [going to] look like, I guess, from a marketing perspective, specifically?

Ben: [00:31:33] So we’re gonna be introducing new flavors. We’ll be exploring additional innovation. We’ll be opening up a bunch new markets. Right now, the brand’s just in kind of New York metro and kind of Los Angeles and Orange County, and you’ll see us launch a number of new markets. And you’ll see the brand become something even bigger than it already is, in the sense that, right now, we just do organic Instagram content and Recess IRL events in New York. And you’ll see us invest heavily in kind of content editorial merchandise and events around the country.

Ben: [00:32:05] The brand that I love the most is actually Disney. Every component of the business exists to drive the other, and if you remove one thing it won’t all fall apart, but I think we have this unique ability to create a new type of wellness brand, a lifestyle—I don’t even like the term “lifestyle brand” but, you know, a lifestyle brand— with kind of a beverage. That’s kind of the core business model. But that allows us to build other things on top of it.

Richie: [00:32:31] What is the single most important thing you have to do to protect the brand? Not the company, but the brand itself. And, I guess, underneath that is like, what are the risks to it?

Ben: [00:32:41] Yeah. Creating the right culture and hiring the right people and communicating the mission and purpose so that everyone recognizes that our strategy is not just to go get on every shelf in Target in America tomorrow, but rather when we launch a market we want to create culture in that city. Because what I think our mission is, is really changing people’s mindset. And, as I described earlier, that happens through a combination of a lot of different things, not just the CBD, right? But in order to do that they have to get kind of every touch point with the brand. And so I think it’s really important that everyone is like, working backwards from that, and that we recognize that sales [are] only one component of the bigger mission, and that distribution is not just about the sales but about marketing, too.

Richie: [00:33:30] Thanks so much for talking.

Ben: [00:33:31] Yeah, my pleasure.

Richie: [00:33:37] Thanks for listening to the Megaphone Podcast, a show from Loose Threads. You can read full transcripts of the podcast and join the newsletter at LooseThreads.com. Feel free to leave a review on iTunes, we always appreciate it, and thanks to George Drake, Jr. for editing this episode. We have a great roster of upcoming guests and we hope you tune in next week.