The strategy is actually the easy part.
I want
to build a model that other companies can look at and emulate.
A
model that’s based on strong ethics and financial success.
I’m
Joe, founder and CEO of Theo Chocolate.
We
exist in a distribution system in grocery across this country,
where
you need to operate at a certain size
and
have a certain level of success just to stay on the shelf.
We
need to grow in order to continue our business.
Joe
convinced me that I should start this company with Joe.
I’m
Deborah, vice president of sales and marketing for Theo Chocolate.
When
Joe realized that he needed to move to Seattle to start Theo,
he
wasn’t going to relocate unless I was willing to relocate
along
with him with our son.
I
didn’t want to be the thing that stood in the way of him realizing his
dream.
And
it’s chocolate after all so, it’s a chocolate factory.
We
produce products that really excited us,
and we
put them in packaging that we really liked.
We
learned very quickly that as fabulous as those products were,
they
weren’t necessarily products that other consumers wanted to have.
When
we looked at our numbers and realized we were not growing
at the
rate that we thought we should be,
and
that in certain markets we were struggling,
we
decided to apply some science to what we were doing.
We had
had a really, really great launch
and
had garnered a lot of accolades both from press and food critics
partly
because of the uniqueness of what we had done.
But
when push comes to shove, it’s really a volume game
and we
needed to be selling a lot more chocolate.
In
order for us to attract a more mainstream group of consumers,
we had
a produce products where the flavors were easily accessible and
understood
in packaging
that was easy for consumers to read on the shelf,
and at
price points that was attractive to them.
Initially
we were targeting green consumers,
or
people who were really foodies,
meaning
that they’re adventurous eaters.
And we
needed also to be selling in places where people just wanted
a milk
chocolate bar.
We
made flavors like coconut curry in milk chocolate.
That’s
not something that plays on main street very well.
We had
people coming into our store all the time saying,
“Well,
can’t you just do chocolate with mint?”
And so
we thought, well, yeah we definitely can do chocolate with mint.
We
weren’t especially excited about doing chocolate with mint,
but we
realized why wouldn’t we do that if our customers are asking for
it.
We
looked at market data for the first time
and we
looked at what were the clear winners.
There
is a motivation to have products out there
that
people understood across the country.
So,
chocolate with orange, chocolate with mint,
straight
70% dark chocolate, chocolate with cherries and almonds.
More
recently a spicy chile.
When
we expand the bar line, it will be dark chocolate with coconut.
Just a
much more accessible product line.
Which
turned out to be a really, really important move for us.
But
there’s already a lot of this kind of product on the market,
you
know on the shelf.
And
retailers have limited space.
You
know just being organic and fair trade isn’t enough.
You
will spark consumers interest because of our certifications
and
the integrity of our product.
But if
it doesn’t taste good if people don’t enjoy it,
and
then really doesn’t matter.
So we
put as much or more of an emphasis on quality
because
without that, then nothing else really matters.
What’s
most unique about us is that we are the only
organic
a fair trade brand that’s actually making of the product that we
sell.
So,
we’re the only vertically integrated product on the shelf.
We’re
the only product where we’re
controlling
the supply chain from start to finish.
We
work with the farmers, we import the beans,
and
all of our other ingredients, we make the product in our own
facility.
So we
are able to control not only all of those relationships and the
quality,
but
the entire manufacturing process and that sets us apart.
Probably
of the single most important
thing
that was beyond our control was whether or not
retailers
were going to be willing to give us some shelf placement,
and
based on our reputation, they did.
And I
think we were incredibly lucky,
but I
also understand it was based on the quality of relationships
that
we had established with them to date.
Alright
everyone on my 4:00 tour, welcome to Theo Chocolate.
If you
have yourself that blue hair net, now is the time.
Get it
out, make sure all those pretty little locks are in there,
check
your neighbors, check your friends,
and
then follow me down into the factory.
Our
educational mission was always a cornerstone of the vision for Theo chocolate.
Amazingly
enough we’re one of the top ten tourist attractions in Seattle,
and
that’s incredible.
That’s
an incredibly humbling thing to me to realize.
But
it’s a really fun thing to do,
we’ve
very intentionally kept the price point really low, so it’s $6.00.
And
the tours are the single most important marketing vehicle we have
because
when we get people in the door here
and we
actually can sit them down, we feed them chocolate,
and we
tell them the story of cacao.
It’s
completely captivating.
And a
lot of people come into the factory
not
knowing what fair trade means,
but
they leave genuinely caring about it.
And
that’s a big part of what defines us, is that educational mission.
We
also have brand ambassadors in key regions around the country
who
embody of the values of our company,
who
tell the story of Theo.
I
think our strategy of trying to reach a broader audience
is
definitely working.
It’s
working by virtue of the classic line because
we’ve
gained a lot of trial for our products
by
putting slightly simpler products on the market.
It’s
also working by virtue of the fact that we’re a slightly older company
now,
and
we’ve learned how to effectively price promote
in
some of the retail channels were in,
which
is a big part of any company strategy.
At
least in our category,
and
people have had more exposure to our brand
and
some of that is just a question of time.
You
can’t build a national brand overnight.
And
we’ve really only been in national distribution for two years.
It’s
pretty cool.
