Simple Strategies is pivoting!

When I started this newsletter last year, I was focused on bootstrapped DTC businesses. Maybe that’s how you found this newsletter.

But I’m pivoting, a little. Why?

There are two big trends happening.

1. AI is still going bonkers. I thought it might slow down by now, but nope, the changes to make it part of long term business strategies have been made. AI is here to stay and it will affect every business.

2. I see a lot of business tear-downs. I hate them. It’s hard to build a business! Why should anyone tear another one down? Instead, just call out what you love.

So that’s what Simple Strategies will do.

Once a week, strategy build-ups of companies that I think are doing great things and my thoughts how they could incorporate AI into their strategy. I write them, not AI.

This week, we're looking at Stanley. They make cool cups. But not the really big one.

Stanley1913 - A century of indestructible cups

Stanley 1913 began when William Stanley Jr. invented a stainless steel vacuum sealed thermos. The first vacuum sealed vessel was invented in 1892 by James Dewar, as way to collect liquified gasses (think liquid nitrogen). The vacuum insulates better than anything else.

But glass vacuum thermoses worked great but were fragile, and if you dropped them they broke. In 1913, William Stanley Jr. realized that a technique he created for welding transistors could be used to make bottles out of steel. Now they wouldn’t break if they fell. Then he made a further modification and packed the vacuum space between the two layers with charcoal dust, making the bottle nearly indestructible. You could drop it off a building and it’d be fine.

Blue collar workers - the police, military, hunters, construction workers - all loved the bottle. There are stories of WWII pilots bringing Stanley thermoses with them during air raids. Maybe my grandfather even flew with one. For decades the company was known for rugged practicality; a good thermos for hunters and plumbers. Sales were consistent, but changing economics cause the brand to be bought and sold a number of times. And as consumer choices shifted, the brand needed to shift strategies.

An idea core to Simple Strategies is the following quote.

Stanley illustrated this well when they took an old strategy and reapplied it with a new method.

An old strategy, with a new method

In 2016, Stanley launched a new product, not aimed at blue collar workers: the Stanley Quencher cup. You've seen it, the pastel-colored water cup now carried by so many millennial women. At first it sold fine, but nothing crazy.

In 2019, three years after it’s launch, an unexpected but important shift occurred. A lifestyle blog called The Buy Guide highlighted the Stanley Quencher Cup, targeting suburban moms and fitness enthusiasts. They proposed a direct partnership with Stanley to distribute the cup. Initially, Stanley declined, instead offering The Buy Guide a wholesale opportunity to sell 10,000 units themselves.

The women who ran The Buy Guide took a huge leap, finding warehouse space and creating their own Shopify store. They bought 5,000 cups and sold them out in 5 days. And then they sold out again. This was a significant product and demographic shift - moving from occasional rugged use to everyday lifestyle use. It also showed the power of an old principle of "women-selling-to-women" that worked so well for Tupperware in the 1950’s. This time though the method was online through blogs, TikTok and Instagram. Stanley smartly saw that it had lightning in a thermos and went all-in on this.

Organic content for the Stanley Quencher absolutely exploded and sales followed suit. In 4 years, sales 10xed in volume, going from $70M in 2019 to $750M in 2023.

Business Model and Product Strategy

I love the way that Stanley has evolved as a company. Their business model has remained largely the same - sell durable products to keep drinks hot or cold - but they've changed the way they find customers and distribute their goods. They shifted just slightly from durable and utilitarian to durable and lifestyle. From blue-collar to white-collar.

Today, Stanley operates with a hybrid sales model, maintaining both a strong retail presence and a direct-to-consumer channel via their e-commerce store. This allows them to reach a wide audience - from campers at REI to TikTok influencers showing off how they accessorize their cups. It's a strategy that works.

AI-Strategy for Stanley

When you're working on strategy for a company that's already killing it, you don't want to mess with much.

You want to try to predict what will happen in the market 2-3 years down the line and start to prepare for that, but not rock the boat too much. No one can predict the future with 100% accuracy, but you can pick up on trends in multiple areas and thread them together.

So if I was asked to create an AI strategy for Stanley, here's where I'd focus.

Near-term (1-2 years):

1. In-App purchases - There's a growing base of consumers making purchases inside their social media apps. Meta offers this on Facebook and Instagram. TikTok Shop processed $16.3B in 2023, up from $4B in 2022.

   Using AI: You get limited customer data with in-app purchases. AI should be able to augment customer data with fuzzy matches from social followings, allowing for personalized follow-up, even if the customer didn't submit their email.

2. Product trends - The YETI Rambler was actually released before the Stanley Quencher. They're basically the same cup, but one captured the moment.

   Using AI: No marketing team can watch all the trends, but AI can. Set a model to watch product velocity and sentiment to help get ahead of new waves of excitement.

3. Customer Service as a cost center - For a brand like Stanley, where there isn't much that can go wrong with a cup and replacing it will make anyone happy, customer service is mostly a cost center.

   Using AI: Klarna, the buy-now-pay-later giant, has already replaced 700 customer service agents with just one AI model, while speeding up the time to resolution. Within 2 years, there will be viable, helpful customer service solutions powered entirely by AI. I’d implement, starting with first tier issues and potentially moving up the chain to second tier escalations.

Far Term (3-5 years)

1. Back to Blue collar - While Millennials loved the Quencher, Gen Z and Alpha might not. With white-collar job prospects plummeting because of AI and college tuitions at all-time highs, the idea of going to college will slowly lose steam. We're likely to see an increase in trades work - we're already at a shortage in many positions.

   Using AI: Nothing to do but watch and wait here. Stick to the goods.

2. AI-Purchasing - To buy products now, we go to an aggregator. They collect goods and present them for purchase. This aggregator could be a storefront (Target), an online marketplace (Amazon), or a social platform (TikTok). AI is poised to become a personalized aggregator, moving in front of all other aggregators.

   Using AI: If this trend takes off, advertising will shift from point of sale to pre-point of sale. You'll no longer be able to get the same juice from a Google Ad, because the AI model will aggregate before a Google search. This will mean a shift in ad-buying strategy and in how products are presented so that AI gets a clear view of the benefits to show a customer.

I like Stanley. I like that their containers are well made and keep your drink really hot or cold. I’d like to see them stick around for another 100 years, through the waves of AI and who knows what else is to come.

I hope you liked this new edition of Simple Strategies! Weekly editions will be like this moving forward.

If it’s not your cup of tea, you can unsubscribe below. I hope you don’t, but you can and I won’t be mad.

If you liked it, reply to this email and let me know! Or forward it to a friend and tell them to hit the big button, not the small one 😀 

Simple Strategies the business has also pivoted! Rather than offering courses and coaching, we now offer Strategy as a Subscription.

• 1 strategy project a month, using your data and our tracking of trends.

• 2 calls with an experienced strategy consultant (me 👋)

• 5 business days to deliver

• $2,000 per month. Pause or cancel whenever.

• Respond to this email to set up a free discovery call whenever you’re ready.

Until next week!

-Nate