The Startup CPG Podcast

Max Dichter
I'm a huge proponent of having the data starting day one, you know, starting day zero, if you can, because it's just really helpful to understand where the category is today, where it's going, or where you think it's going, where it has gone over the last several reporting periods. The competition is what they're up to. All those things are really important. As you craft your story, you craft your narrative of why you, as an emerging brand, deserve to be on shelf. And so I think if you can get your hands on the data, the sooner the better. Of course, I know that's not always a practical answer because the cost of data is expensive and you can get insights in more efficient ways, albeit with smaller sample sizes.

00:48
Max Dichter
But I would say as soon as you can get your hands on it, the better it is.

00:53
Daniel Scharff
Welcome, CPG ers and anyone who's data curious to a mini episode of the Startup CPG podcast about data. As many of you know, one of our closest partners at startup CPG is Nielsen IQ and their product, bizarre. I actually used to be the head of analytics at a food tech company, and I always thought that Nielsen IQ was the best partner for merging brands because they have great coverage, they have accessible price points on piecemeal data and especially through their product for emerging brands called Visor. So with startup CPG, you can actually get three free reports from Visor. You could get velocity on your own brand or competitors in a channel or even at a particular retailer like Whole Foods. You could see what brands have grown or shrunk the fastest and so much more.

01:36
Daniel Scharff
Check the show notes for the link on how you can get those three free reports. And in today's episode, I wanted to highlight how one brand, fourth and heart, actually uses the Beyser data. So I'm very pleased to welcome Max Dichter, their CEO, and Jamie win, the director of finance and strategy. We're going to talk through their data journey and all of the insights and what it's done for their business. All right, let's get into it. Hello, everyone. Here we go. So if you haven't heard of them, fourth and Heart is the largest and fastest growing ghee company in the US. They are nationally distributed in over 12,000 stores. They're on a mission to shine light on the simplicity and superiority of Ghee in a crowded world of basic butter. So my friend Max joining us today is their CEO.

02:21
Daniel Scharff
He is a total profitability whiz with deep expertise in finance, Ops, team building and so much more. He used to be my neighbor here in Los Angeles. His dog and my dog used to best friends until Max moved away, but we're not sore about that or anything. He is also my first call anytime I have questions about fundraising or lending options. Jamie. Also joining us is the director of finance and strategy at Fourth and Heart. She joined the company first as a warehouse manager back in 2017, when Forth and Heart was self manufacturing from a shared kitchen space in downtown Los Angeles, which was actually amped kitchens, which is another startup CPG sponsor. Then in 2020, Jamie took a leap of faith.

03:02
Daniel Scharff
She took an opportunity from Max, who was then the vp of finance, to transition from Ops into finance as a financial analyst. Now she works closely with the leaders of the company to identify and model growth and cost savings opportunities and provide analytical horsepower on key strategic projects. Welcome. So, Jamie, I'm very curious. How has this ride been in the world of finance since you transitioned over from Ops? Has it been a lot of fun to work with Max? Finance in general is very scary to me, so I really respect you doing that.

03:32
Jamie Nguyen
Yeah, I mean, I don't come from a finance background, so I think I was pretty apprehensive about accepting the role and believing that is something that I could do. But, you know, Max was very committed to making this work. I was committed to making this work. We spent a lot of time together, and I'm here today still doing finance. It's been a wild ride. I've learned a ton, and, you know, things I'm able to do today. Looking back on it, I look back on it with a lot of pride, and I look forward to what's to come with a lot of excitement.

03:58
Daniel Scharff
All right. Amazing. And, Max, how is your lovely dog Billy doing? And does he miss my dog, Sophie, who I will pull up here now. For anyone watching the YouTube, Billy's amazing.

04:09
Max Dichter
He's living not a bi coastal life, but, you know, it's a little bit of marina life, a little less Hollywood life, and, oh, Sophie, here's little Sophie. He misses his girlfriend so much.

04:21
Daniel Scharff
So Max's dog Billy and my dog Sophie, we lived on the same hall, so they would just race around. We'd play hall ball, just like throwing a ball in the hallway, which was pretty cool. And every now and then, I would try to confuse his dog Billy, by throwing a tennis ball off my fifth story balcony just down into the playground area, and it was like it came from heaven. A beautiful tennis ball. But unfortunately, we're not just here to talk about dogs today, but fortunately, we're here to talk about data, which is really one of my favorite topics. So just to jump right in first, actually, Max, do you mind maybe giving people kind of overview or update on fourth and heart? And I'm also really excited to hear about how it's been going with the launch of your gee stick.

05:02
Max Dichter
Yeah, absolutely. Well, you gave us a nice little intro before, but just as a refresher forth in heart is the largest and fastest growing company in the US. We're nationally distributed in over 12,000 stores nationwide across natural, conventional Whole Foods, and we have a pretty large omnichannel presence within Amazon and other retailers that you typically find CBG products on. We recently actually got into the mass channel, which we'll touch on later on in this podcast. Probably we start talking about data and how we've used it. But yeah, we're also in Walmart, and then we'll talk about the other retailer that we got into or getting into later this year.

05:40
Daniel Scharff
Amazing. All right, cool. I can't wait to hear it. And then also, Max, what is ghee? For a lot of people who don't know what it is or just, it's like a word that they're unfamiliar with, like, really, what is it? How is it different from butter?

05:51
Max Dichter
Who's using it in the simplest way possible? Ghee is better butter. And by. By that we mean it's richer, it's more functional, and it's healthier than traditional butter. It's richer because it's 100% butter fat, whereas traditional butter is by 82% butter fat. It's more functional because it has no water or lactose milk fat in it, which gives it a high smoke point properties. So you can actually cook with it up to 485 degrees before it smokes. And lastly, we say it's healthier than traditional butter. There are a variety of reasons that the simplest, at the highest level, it's lactose free, it's casein free. So it's a lot more approachable to a lot more people. But it does have higher vitamin contents of ade and k, higher levels of cla and butyric acid, which are found to be helpful in digestion.

06:39
Daniel Scharff
And, I mean, I know now it's a pretty nice category on its own, but, like, was it always that way? Or how did people start learning about ghee and getting interested in it?

06:48
Max Dichter
You know, it's fascinating. Ghee is actually huge. It's a $30 billion category outside of the US. Here in the US, it's still pretty nascent. It did become a little bit more mainstream as the paleo keto whole 30 diets came about several years ago, and there was this concept of bulletproof coffee that came out that uses ghee in it. And so ghee became a little bit more popular then. But one of the biggest challenges, I'd say opportunities as well, for fourth and heart, is really democratizing ghee here in the US. And part of that is positioning it in a way that consumers understand and can find familiar. And so that's sort of a good segue into the Gy stick conversation. One of the things that we've done coming out of consumer insights, actually, is position.

07:35
Max Dichter
The ghee that we sell in our jar, the best selling product in a format that people already know and love, which is the butter stick format. So fourth in heart past a year, it took several years and a lot of money to make this happen. But in the last year, we launched the first ever, dare I say, world's first ghee butter stick into the refrigerated section of the store, sitting right next to other premium butters on the shelf. Think of, like, Kerrygold or, you know, vital farms, Maple Hill, things like that.

08:04
Max Dichter
And so what we're trying to do is show consumers that ghee can be used just like butter, one to one, and it can exist in the same format that they already know and love in the part of the store they expect to find ghee butter, and at a price point that's more approachable than the jar currently is.

08:21
Daniel Scharff
That's awesome. Yeah, typically, I've seen it all over the place in the jar, and then I also cook with it. You were nice enough to give me some samples to get me hooked, which, you know, I think, like, I just remember learning from my old chef friends at just egg when I was there, I was like, oh, I just cook with olive oil. They're like, you, what? Are you crazy? Like, don't you know? And, you know, apparently, because the smoke point of it, I guess, is pretty low, so everyone agreed that ghee is a pretty good way to go. So I started using that, which has been awesome. And then in terms of the butter stick, I mean, that makes a lot of sense, right? That's where a lot of butter is sold in that stick format.

08:54
Daniel Scharff
So probably it'll be a cool way for a lot of new consumers to discover you.

08:58
Max Dichter
Absolutely.

08:59
Daniel Scharff
All right, so we're really here to talk data, which is, as everyone knows, one of my favorite topics. I used to be the guy actually, at just egg, who would pull all the data. I would work that stuff. I would, like, pull it into all these different cubes. Twist it, turn it, see all the insights, tell all the stories, which was very cool, because once you become the person who really knows how to tell the stories, then they start doing nice things like inviting you to the buyer meetings, which was, I think, always the most fun for me. So hopefully they bring you to do that, Jamie. But maybe can you just take me back to why did you initially want to get some visor data, for example? What was your goal? What were the questions you were trying to answer?

09:39
Jamie Nguyen
Yeah, well, for us, like, the big thing was understanding, you know, the category. How is the category performing also within larger context of just overall butter, and then, you know, where forth at heart stands within all of that and what opportunities that provides for us. So that's primarily how we use the data, but we also use the data to inform, you know, forecasts, projections, you know, targets that we have upcoming and what that really means for the company as a whole.

10:06
Daniel Scharff
So it sounds like maybe a mix of probably trying to assess some opportunities from an internal perspective, make some decisions around product lines, products, but then really also then looking at the competitive landscape, understanding how you're sitting against competitors in the market at specific retailers, stuff like that. Does that sound right?

10:24
Jamie Nguyen
Yeah, absolutely.

10:25
Max Dichter
We looked at this data for a long time, always looking at who number one was, chasing them up, leaderboard. And it's nice to be on the other side of that, knowing that we're in the number one slot in terms of dollar sales, unit sales, velocity growth, et cetera.

10:44
Daniel Scharff
Yeah, that's a pretty fun process because, yeah, I mean, any brand that's starting out obviously doesn't start out at number one. So then you immediately want to size up the competition. Like, where are they selling? How much are they actually selling? And, I mean, in my experience, it was just so important to understand that and very quickly start telling your story any way you could. Right. Like showing ways where we're even outselling them, whether it's just, you know, maybe not at first units per store per week, but at least, well, what if I look at the number of facings they have, and then I can say, look, we're doing pretty good for one facing versus their ten. Maybe you should give us a second facing. Right. Like all kind of incremental arguments to try to get up the ladder.

11:23
Daniel Scharff
So how did you decide which data you wanted to get from the big universe of data that's out there when.

11:29
Max Dichter
We first started buying data? That's a good question. Obviously, we couldn't afford it all when we first started, so we just started with the lowest hangover and what we felt would be most helpful to us, we bought chunks of data. Sometimes we even bought just snapshots of data, snapshots in time, because that was enough for what we needed at the time. Now that we've grown and we're selling in multiple sets across the store, it's really important that we have a holistic view of everything going on. And because of that, now we buy a lot of data to inform our business.

12:06
Daniel Scharff
That's a pretty frugal and good way to do it. I think when you're a growing brand, right, sometimes you can just buy a quick snapshot that gives you everything you need. At that point, you can look at some cuts. Maybe your performance isn't going to change so much over the different points, but yeah, then obviously as you grow, then you start needing to be able to track more consistently or you just, you need more cuts to be able to tell your story better, look at the different options. And so what was the process of actually getting the data like then with Pfizer?

12:35
Jamie Nguyen
So with Pfizer, it's really nice. There's a lot of free rein. You can go in there and build your own reports and set it up such that it's, it out every four weeks, every month, depending on how you want. There's a lot of customizability. So we, I go in there, I'm the guy pulling the data and antithesizing it into dashboards and stuff. But I initially set it up to see all the metrics that we would like to track. Ideally, you know, unit sales, store counts, velocity, acv, all that stuff, promo period related data as well. So it's all set up now such that every four weeks the data automatically is uploaded and ready for us to download and view, which is really nice.

13:14
Jamie Nguyen
And then on top of that, you know, if we want to look at something more specific or, you know, we want to dive deeper into region or something, we have that ability as well, Pfizer. So it's really nice.

13:24
Daniel Scharff
So what is the total scope of the data that you get from visor?

13:27
Jamie Nguyen
So we get a total whole foods at like the all inclusive of all regions level. We also get regional data, which is really nice. It allows us to be more strategic about certain marketing issues where we want to target it. And then in addition to that, we get just total channel level.

13:43
Daniel Scharff
Great. And I know, I think the Whole Foods is an exclusive with Nielsen and Pfizer. So that's pretty much the only place I believe you can get that if you're looking for that nice Whole Foods data. So that makes sense. And then did you check how pricing for the kind of data you were looking at would compare to other places that you could get data? I mean, obviously we're all trying to be frugal. So did you have just kind of a sense for the magnitude of the competitive options?

14:09
Max Dichter
Yeah, I would say anecdotally, this data was, it felt comfortable and was the right price for sure. I think, for any emerging brand or brand that's looking to get data at a more efficient cost, Nielsen and Pfizer would be. Those are great tools to leverage in their pursuit of insights.

14:29
Daniel Scharff
Awesome. Okay, perfect. So now let's get to the good stuff. Let's cut to the chase. Let's talk insights. What did you see when you started looking into the data? What was some of the biggest stuff you saw and what was the impact on the business?

14:42
Max Dichter
Man, gosh, we look at data so many different ways, but not dissimilar to how I'm sure everyone does. But I think when we first got the data, it was really staggering to see what's actually happening nationally at Whole Foods with our competition. And were able to really see the movement of skews entering the set and also departing the set, which was helpful as we thought about crafting our narrative for buyer meetings. Also, it was really good to see, to get a pulse on pricing nationally and how our competitors were pricing their products and when they were promoting, how much they were promoting, et cetera. There are definitely levels to how you use the data and how crafty you want to get, but we have our eyes.

15:27
Daniel Scharff
What would you do with that kind of info you see when the competitors are promoting? I, in the past have used that as, okay, here's when most of the volume happens in the category. Here's when the competitors are promoting, and we can probably decide to promote at the same time, or we could kind of promote around it. But is that how you think about it or what? What does that tell you to do?

15:47
Max Dichter
Yeah, I think that's one way of thinking about it. Another way I look at it, just, like, understanding how much they're promoting, how often they're promoting, you know, just to try to understand, like, the price elasticity of their customer base. Also just strategically think, trying to understand, like, how they're operating, not really a whole lot you can really do with that. It's just more really just understanding, being a student of the business, really just really knowing your category as well as you can. There might be opportunities that present themselves, and if you have the insight readily available, then you can leverage it.

16:17
Daniel Scharff
So, Max, earlier at the beginning of this interview, you teased something about another unnamed mass retailer. Can you share anything about that? And how did data help with that?

16:27
Max Dichter
Yeah, yeah, definitely. And I'm happy to share the name because we're really proud to be a partner of Target. Target was a retailer that were in several years ago, but unfortunately were discontinued from. And using the data and having an excellent team, of course were able to get ourselves back in. And by that, I mean watching the category, watching what was going on, not necessarily with our product, obviously, because weren't on the shelf, but with other products on the shelf and other skus in the same set, were able to understand what was going on with the category holistically compared to what was going on with the category in other retailers and tell a story about performance and how things could have been different or could be different with fourth and heart on their shelves. And that was pretty incredible.

17:16
Max Dichter
It was a case study, for sure of how you can leverage the data to really get you back on shelf and foster a strong relationship with your buyer. There's a lot of really interesting stuff going on with Target right now. We are coming back on shelf here in the next three months with six times the amount of stores that we had before. So pretty big increase in store count and might even have some more exciting things in the future there.

17:41
Daniel Scharff
That's amazing. Congratulations. That's so good. I mean, Target is massive, obviously, and to have six times the store count and, I mean, it's pretty interesting. Just like the kind of the role that data plays when we're telling our stories, but also, like, the buyers, they depend on it, right? Because, you know, they aren't looking at every single piece of data. Probably somewhere like Target, they have more resources to look at data, but in general, like, they really do rely on us suppliers to provide them with insights. They may have just not looked at a particular brand in a while. When you can show them an insight, they're like, oh, okay, yeah, I should look at that. Actually, you're right.

18:14
Daniel Scharff
So it just really helps when the story that you're telling them about your product and your consumers and what it can do for them is backed up by that data and will just really change how they think about it. So nice job. And so, I guess, Max, what would you recommend for early brands about when to start going for data? I mean, one good thing is with Nielsen Pfizer startup CBG, you can actually get three free reports, so the price is right on that one, just to kind of get started in learning how to use it. But what do you think about when brands should think about starting to purchase data?

18:48
Max Dichter
I think it really comes down to affordability, and so I'm a huge proponent of having the data starting day one, starting day zero, if you can, because it's just really helpful to understand where the category is today, where it's going, or where you think it's going, where it has gone over the last several reporting periods, who the competition is, what they're up to. All those things are really important. As you craft your story, you craft your narrative of why you, as an emerging brand, deserve to be on shelf. I think if you can get your hands on the data, the sooner the better. Of course, I know that's not always a practical answer, because the cost of data is expensive and you can get insights in more efficient ways, albeit with smaller sample sizes.

19:31
Max Dichter
But I would say as soon as you can get your hands on it, the better it is.

19:35
Daniel Scharff
All right then. Jamie, do you have any advice for people about how they're actually pulling the data as well? Any tips or tricks that you've learned about using the visor platform or it sounds like you're using it and pulling it into some dashboards, like anything that you would recommend to somebody who hasn't done it before?

19:52
Jamie Nguyen
I recommend pulling as much data as you possibly can. There's obviously limitations to what's available, and even within the reports themselves, there's going to be limitations. But max it out. The more the merrier. You can always reference it and dig deeper later on, as long as that data is somewhere stored for you, max it out.

20:11
Daniel Scharff
No pun intended. Thank you so much, Max and Jamie. Yeah, I'll never get tired of this topic of data, because really, for five years I just lived it. That's what I was doing every day, pulling the data, thinking about the data, dreaming about the data, using the data. And I just couldn't possibly overstate how much it actually has done for me in my career. And the opportunities that it gets you in. It doesn't even always have to be so complex. Like, you can have a really, you know, filthy data slide that does shows all these complex analyses, but sometimes it's actually just the one insight that does the biggest job, I think, like, the best slide ever put together for my last company was just, we're the number one growth brand in ACV, in the channel, and it was just a big number one.

20:56
Daniel Scharff
And it did say where the data came from, but it did not show much. It was just. And then that was the slide when I posted on LinkedIn where the buyers were like, hey, apparently I need to talk to you now because you're number one growth in the category, so it's.

21:07
Max Dichter
Powerful when you have a slide that says that.

21:10
Daniel Scharff
Yes. All right.

21:11
Max Dichter
I guess I would say, as a final thought here, we really appreciate startup CPG and making the introduction to Nielsen and buys your product. It's made Jamie's life mostly a lot easier and gives me the ability to look at awesome data that she cuts up and displays to me in great ways. And those three free reports that they offer are huge for emerging brands, so definitely would encourage folks to take advantage of them. So, yeah, thank you.

21:37
Jamie Nguyen
Thanks, Daniel.

21:38
Daniel Scharff
All right, thank you both. Congratulations to both of you. And fourth and heart for all the growth. And you definitely have a customer in me, so keep the, I'd say keep your sampling program active for all of your neighbors. It definitely works. And thank you guys again. And also, and just thanks to our friends at Nielsen IQ for the partnership. All right, bye, everyone. Everyone. All right, everybody.

22:02
Speaker 4
Thank you so much for listening. If you enjoyed the podcast today, it would really help us out if you can leave a five star review on Apple Podcasts or Spotify. I am Daniel Scharff. I'm the host and founder of startup CPG. Please feel free to reach out or add me on LinkedIn. If you're a potential sponsor that would like to appear on the podcast, please email partnershipstartupcpg.com and reminder to all of you out there, we would love to have you join the community. You can sign up at our website, startupcpg.com to learn about our webinars, events and Slack channel. If you enjoyed today's music, you can check out my band, it's the super fantastics on Spotify music. On behalf of the entire startup CPG team, thank you so much for listening and your support.

22:45
Daniel Scharff
See you next time.