The founder of the most popular kombucha brand in America explains how the company recovered from a dramatic drop in sales with a quick pivot to delivery

GT Dave, founder of GT's Living Foods

Summary List Placement

Kombucha, the fermented tea drink that tastes a bit like sparkling apple cider vinegar, has gained mainstream popularity in recent years for its supposed health benefits — though the drink is thought to have originated more than 2,000 years ago in Manchuria, China. 

GT’s Living Foods is the most popular kombucha maker in the US, with 48% market share according to wellness-focused data tech company SPINS. Founder and CEO, GT Dave, started the Southern California-based company as a teen in 1995. He home brewed bottles in his parents’ kitchen and then pitched his way into health and grocery stores. 

The coronavirus pandemic has been a roller coaster for the company. It started with a spike in sales as people frantically cleaned store shelves and stocked up on health products. Then came a dramatic drop in sales as more people worked from home, or lost their jobs, and cut their spending. Basic essentials like milk, eggs, and orange juice dominated the refrigerated aisles.

“People weren’t going to work, which influences their shopping behavior. They’re spending a lot more time at home, which influences their eating behavior,” Dave told Business Insider.

The slowdown lasted about a month until stores figured out how to manage shelves and meet demand. GT’s gradually rebounded and sought new ways to reach its customers, like selling direct-to-consumer for the first time. GT was recently named an Entrepreneur of the Year of Greater Los Angeles by EY.

Through the ups and downs, Dave learned new marketing strategies and leadership skills. He shared his insight with Business Insider.

Identifying demand for a pivot from stores to home delivery

The biggest change for the company came when it pivoted to ecommerce. GT’s noticed a demand for online sales as grocery store lines got longer and people were nervous to leave their homes. 

“We saw the whole spectrum of the reasons why people couldn’t access our product, but the one common denominator is they still wanted our product. So we needed to make sure that we had a solution to that,” Dave said. 

Customers asked if they could purchase GT’s kombucha online, and they were willing to pay the shipping cost. The company quickly partnered with a local distributor that was looking to make up business lost during the pandemic. GT’s started by offering home delivery in the Greater Los Angeles, Orange County, and San Diego areas and plans to expand to other states. 

Ecommerce is not yet 10% of GT’s sales, but Dave believes it’s a necessary step to adapt to accelerated trends in the way people want to shop. A platform like Amazon wouldn’t be right for GT’s, even if it would’ve been a lot easier. Like many brands, the company will have to carve out its own ecommerce solutions to meet online demand.

“We have learned we really need to develop our own network, whether it’s utilizing retailers, distributors, our own warehouses, or all the above, to find a way, regardless of where somebody lives, to get them product,” …read more

Source:: Business Insider


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