“A-Ha Yourself!” Case Study: Honest Tea
August 13th, 2007 by Lani and AllenSome companies “A-Ha themselves” better than others. Honest Tea is one such company.
To be fair, they have a few grand assets in their favor:
- They’ve been growing, learning, and improving as a business for nearly a decade.
- They’ve got a PERFECT name - one that describes their product, mission, corporate intentions and values, AND is a working homonym for prime virtue (one that’s hard to come by in these hyped-up, slick-willied times).
- They’ve got clear-sighted, realistic, high-idealed leadership behind their mission and message in the forms of their laid-back visionary and TeaEO Seth Goldman, and former business professor and genuine student of life, Barry Nalebuff. (Read their story here.)
Allen and I had the opportunity to hear Seth talk, and to make his acquaintance, at Stonyfield Farm’s Entrepreneur Day in March of this year.
In front of more than 100 small business owners, solo-preneurs, and enterprising professionals from all over the country, Seth talked about “The Thermos Stage” of Honest Tea back in 1997/1998, when an idea for a less-sugary, more satisfying beverage fueled a decision to quit his “real” job and concoct drinks in his kitchen, which led to a taste-testing with Fresh Fields (now Whole Foods) just five weeks later, which led to a jaw-dropping order of 15,000 bottles, which ultimately led them to a stellar first year: $250,000, to be exact.
But that was just the beginning.
The next bunch of years Seth called “The Neither Land Zone.” While Honest Tea enjoyed steady revenue growth ($1 million in 1999 became $1.9 million in 2000 became $3.2 million in 2001 became $4.6 million in 2002 became $5.5 million in 2003…Can ya dig it? It’s all on the history page of their site…), this was a real Trial ‘n Error phase. Lots of botched batches, experiments in marketing gone awry, sprinkled with outstanding kudos from Inc. magazine, Visa, and the Natural Foods Industry. (They were the Grand Prize winners of the “Dream Big” award, which is a salute to their blossoming vision and “A-Ha Yourself!” moxie.)
Basically, this phase of Honest Tea’s growth was all about branding, marketing, and selling tea. But a successful business can’t thrive in this space for too long without boredom, burnout, or a dire sense of futility for all involved. Eventually, a biz either stagnates and dies, or - as Seth said - “…evolves into a broader idea…”
Idea evolution is the route Honest Tea took, and it catapulted them to The Breakthrough Stage.
First, there was a clarity to their vision: Authentic. Organic. Healthier. Socially responsible.
They were no longer a company obsessed with products or systems. They became a company that stands for a set of ideals, principles and values; one that shares learning tools, leverages talent, market position, and passion to make the world a better place.
A company with a bold mission becomes more than the sum of its parts. Suddenly, a bottle of liquid is a promise of something better, an expression of commitment, and a lifestyle choice.
Such integrity behind a brand excites consumers and employees alike. And as privileged as we are to be citizens of the United States, most of us are starting to realize we can exercise our buying power in better, more thoughtful and globally meaningful ways.
Honest Tea gives us a way to do just that. What we especially like about Honest Tea is they don’t preach. They INVITE. Just one visit to their recently revamped website and you’ll see what we mean.
One thing Seth said really resonated with us: “Sometimes you know what you’re about, but you don’t have the same backbone as the people around you.” Ain’t that the truth, tho’?
And he left us with six leassons that ANY entrepreneur or small business owner could use in a pinch:
1. Make sure you know what you stand for.
2. Choose your friends wisely.
3. Don’t raise more money than you need.
4. You have find BALANCE, and you have to start with it early.
5. It’s HARD. It takes work. Don’t be frightened.
6. Do what you’re passionate about. Period.
It turns out Seth has indeed chosen his friends wisely, as he and Stonyfield Farm’s Gary Hirshberg have an obviously strong connection, as friends and fellow business radicals.
And since one of Stonyfield’s most effective and celebrated marketing practices is their affinity for blogs and blogging, may we be so bold as to say Honest Tea is a prime candidate for launching and cultivating a blog of their own.
Addressing issues around sugar consumption, fair trade practices, and the benefits of going organic - these and more are issues and missions ideal for a company like Honest Tea.
Keep an eye on their growth and progress. We predict they’ll be leaders in the pursuit of a better, healthier, more conscious life and lifestyle.
