00:00:04
We took a gamble on podcasts, it was very early in the world of podcasting, but what
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we liked about it was, well, you're listening to people you trust, but you get time with
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them. All right. The AG1 products, as demonstrated, even though you did a superb job, Barbara, it's kind of
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hard to explain, right? It's a daily health drink. It's a green liquid, and I don't know how to explain it, it just kind of looks yucky.
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Green liquid that looks yucky. Okay, let's start from there. Hello, and welcome.
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You're listening to Marketing Matters on the Wharton Podcast Network. This is our weekly podcast where we analyze the latest in advertising, marketing, customer
00:00:45
behavior, new product launches, branding, retailing, everything marketing. I'm Barbara Kahn, the Patty and J.H. Baker Professor of Marketing, and I'm joined by
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my co-host, Americus Reid, the Whitney M. Young, Jr. Professor of Marketing and the brand
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Identity Theorist. And today, we have a very special guest, Pauly Derry. He's the Chief Marketing Officer at AG1, which is a global health company focused on foundational
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nutrition. AG1 is best known for its all-in-one greens powder that combines vitamins, minerals, probiotics,
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all sorts of weird stuff, sorry, but cool stuff that Americus probably knows about into
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a single drink. And what's also interesting about AG1 is its marketing strategy.
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It has a very strong presence in podcast advertising. It's been on the Joe Rogan Experience, the Tim Ferriss Show, the Huberman Lab, and it's
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this idea of building trust at scale through host-read storytelling. It's a very modern age, modern brand, and we are so happy to have Pauly Derry.
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As I said, he's the Chief Marketing Officer at AG1, but he brings over two decades of
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brand marketing experience to this role. Before he went to AG1, he was the CMO of Yeti, quite another cool brand, and he played a
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creative leadership role at Uber during its transition from a startup to an IPO.
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We're going to talk about how you build a premium brand in a very crowded category,
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how you do it at scale, how you can use podcast marketing to build trust and performance.
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We're very delighted to have you, Pauly. Hello, and welcome to our show. Hi, Pauly.
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Wow, Barbara, what an intro. We've got to get AG1 on this podcast immediately. What a job you did there.
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That was outstanding. Yeah, she's a pro. We'll get her an affiliate code ASAP. Incredible.
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And I did mention that you were going to come on the show with a superb accent. I've been working on this Australian accent for quite a while.
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You're very good for storytelling. Yeah, it's very good, mate. Awesome. Yeah, I think if I ever lose my accent, I think my wife might leave me.
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So I've got to keep it. It's all I've got, guys. There's a lot at stake. Some of the things that definitely matter.
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So what do you want to talk about first? Do you want to start with AG1 and podcast?
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Do you want to talk a little bit about what you did before you got there? What's your preference?
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Well, yeah, I mean, we're on the podcast train. Maybe I'll try and couple a bit of it all together because I think it is all connected.
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And a big part of it is how do you build trust as a brand, right? And I think with AG1, what's really interesting is, you know, we took a gamble on podcasts.
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It was very early in the world of podcasting. But what we liked about it was, well, you're listening to people you trust,
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but you get time with them, right? The AG1 products, as demonstrated, even though you did a superb job, Barbara,
00:04:07
it's kind of hard to explain, right? It's a daily health drink. Well, I'm a man to green liquid.
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And I don't know how to explain it. It kind of looks yucky. Green liquid. Barbara just gave you everything she's got, Paulie.
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That's great, guys. It's a green liquid that looks yucky. Okay, let's start from there, Barbara.
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How do you sell a green liquid that looks yucky? We'll work it up. So yeah, you know, it's got 75 ingredients.
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It's got pre-probiotics. It's got multivitamins. So it's really just like, you know, more in one kind of way to start your day.
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You put the powder in nice cold water, and you drink it, and you're done. You've done yourself a really good service.
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But to explain that and anything you put in your body, you need time, and you need to build trust.
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What podcasters gave us was that, right? Time. Time to explain the product in detail.
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Not only that, everyone we work with has to be an AG1 drinker, right? They have to have been an AG1 drinker.
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Or if they reach out to us and they haven't tried us, it's like, great, guys. We're going to send you some products, and call us back in a couple of months
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and tell us, you know, how have you found it? Has it worked? You tell us. But we need them in the journey, right?
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Authenticity. We need it. It's super important. Look, and then along came COVID, right?
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And what happened? People all of a sudden didn't have the answers and were looking for information, right?
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And they turned to people they trust, and primarily via podcasts, right? So it was an interesting moment in time where people were doing the research
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and really trying to understand what they could take to help them through that process.
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And thus, I think, was where we had great success. So, yeah, it's been a great story on podcasting.
00:06:06
Again, just to allow to tell the story and build the trust. One thing I think is really interesting about this,
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I was one of those people who converted to podcasting during COVID. And I'm very loyal.
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I don't listen to the same to Joe Rogan, but I do listen to my own podcast that I like.
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And what I think is interesting about what you're saying is that typically when you listen to ads, you skip through them.
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But when you're listening to a podcast, and that host has integrated the story into the podcast,
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and the voice is the same. First of all, it's not as easy to go through it. And second of all, if he or she is a good storyteller,
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you're halfway through the story. You don't even want to skip it because they're telling you something that's informational.
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And so it is very interesting, the collaboration between the right brand and the right podcast host.
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And it's a very different way of thinking about advertising. Very. And you're spot on.
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And look, we cast a pretty wide net on who reads our stuff. As long as they're authentic, as long as they love the product,
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that's great. Talk to your audience about it. Only if you truly believe it, though.
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It's a big world out there, and that's where we're focused. And let me try and pull the thread back through my history.
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You think about a brand like Yeti. Again, how does that trust build up? Well, it builds up through a couple of things.
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Yeti did an amazing job early on of getting into the communities. Community marketing is still a huge part of Yeti.
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And getting in with fishing guides on the coast of Texas and Florida. But really becoming part of that culture and family, really.
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And then as the brand grew, as word got out, other communities popped up. And what we did at Yeti was we didn't force it.
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If a community embraced the product, well, then we would embrace them. We would follow the tracks, not try and force them.
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And it built up this same thing. Well, this community are using the product. And they're actually loving the product.
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Once that's done, well, then I'm going to go and engage. As opposed to inflict it on them.
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And it kind of kept growing that way at Yeti. So that very organic trust through the communities
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is what we followed and built the brand around. And then we told great stories on top of that.
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Another way to build trust. Telling great stories that aren't product-centric, that aren't trying to sell you things.
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They're just trying to introduce you into the world that you're in. It's another great way to build trust.
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The other thing that's interesting to me about AG1, and Americas, I do want you to weigh in on this.
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He's not allowed to talk. He's not allowed to talk. But you changed your name from Athletic Greens to AG1.
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And you're also talking about, the Yeti strategy seems somewhat different to me than Athletic Greens or AG1.
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I mean, from what you're saying, the way you bottom-up built Yeti. And it seems like this AG1 is not quite the same.
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Is that right or no? So let me tell you where there are a lot of similarities there, Barbara.
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Both created a category, right? And a premium version of the category. Right? So you could buy a cooler before Yeti.
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You certainly couldn't buy one for $100. Yes. You could buy vitamins. You could buy minerals.
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Yeah. That's fair. But AG1, we put it all together. In a really nice tasting green powder.
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Okay. So what happens after you make this breakthrough, right? Well, everybody comes in, right?
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Knockoffs appear out of the woodwork. Yes. You know, in the supplement industry,
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there's a lot of snake oil out there, right? And so what are you trying to stop?
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You're trying to stop becoming a commodity. And what I mean by that is, look, you could walk into a Dick's Sporting Goods,
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pull out an insulated cup, hold them side by side and say, right, which one am I getting?
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This one's $20 cheaper. Maybe I should just... Okay. If you are in that world, it's over.
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Your brand is over. You have no longevity. You have no love. You have no cult following.
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You are a race to the bottom. And that's okay. If that's your game, go for it. Right?
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I'm not interested in those brands. I really want to feel something for the brand I'm purchasing
00:10:58
or working for. So my real focus with both of these brands is they can't become commodities.
00:11:06
Well, what does that mean? It means the customer has to make their mind up because they love it before they walk in store.
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Right? Hey, I'm walking in and I know I'm getting a Yeti. I just don't know which one,
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because I love Yeti. Right? Same with AG1. Well, boy, it's a crowded space, but AG1 seemed to be the real,
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you know, scientifically backed. They feel like the premium. I like the brand. That's where I'm at.
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That is the magic. Right? And that's where brands have to get. The problem is it is at odds with your CFO a lot of the time.
00:11:45
Right? Doing the theater. Wait a minute. Hold on. The CFO and the CMO are at odds?
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Wait, I've never heard this. Well, any aspiring CMO out there, I think the first interview you've got to have with any business is the CFO.
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And if you don't vibe, it's going to be very, very hard. I always say, look, you should want to join a brand or a business that wants to do this.
00:12:08
Right? It wants to be a brand leader. It understands the beauty of brand. It understands the beauty of what you do.
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It's like when you're with a boyfriend or a girlfriend. Right? I'll be the one that changes them.
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I'll be the one that, no, you won't. They have to change themselves. Right? Like it's going to be a miserable,
00:12:25
miserable effort. Well, so to that line, why did you change the brand name? Why did you go from Athletic Greens to AG1?
00:12:32
And when did that happen? Good question. That was actually because our category,
00:12:38
we are not a greens. We are green by color. Right? And if you think about all the knockoffs that started to appear,
00:12:48
and Snake Oil, they were saying we're a greens. But they weren't, there were no pre-probiotics.
00:12:53
There were no multivitamins. There were no, so they were coming out at, you know,
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half our price saying we are a greens, just like us. And we're like, but we're not.
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We're more than that. So AG1 was the way actually to say, it's a lot of things in one,
00:13:11
right? And not lean heavy on the word green. It reminds me a little bit of when Kentucky Fried Chicken changed to KFC
00:13:20
to stop having people rehearse the word fried. It's a tough one to, yeah, it's a tough one to swallow in the health regime.
00:13:29
That's very interesting. Let me ask you this, Polly, because I want to go back to the point that Barbara made about brand,
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because I'm hearing the word brand and the difficulty of the CMO to be able to show up with hard numbers,
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right? Because the CFO loves the hard numbers. They want to see like, what's this thing worth?
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And what's the, what is the brand equity worth? Especially in podcast advertising,
00:13:49
which is brand new. Yeah. So, so talk a little bit about that, that point, because,
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I mean, as a brand, you have to sort of put something on there to, so it's not a commodity.
00:14:02
And talk us through that, but also remind me a little bit, because you said something that I want to push back on a little bit,
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Polly, which is the idea of not push back on, but ask you about the challenge of letting anyone come in and say,
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hey, let me use AG1 and I will promote. Because it's, because that seems risky in some ways,
00:14:22
because it's like, it's great when Andrew Huberman shows up because he's got the books open.
00:14:27
He's doing the science. But, but if you have some bizarre podcasters showing up for some weird,
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extreme part of the internet and they're like, hey, I want it to, you know, are you going to say no to those guys or what?
00:14:38
I mean, talk to, there's got to be some like non starters that are out there. Give me a sense of that in terms of how you think about it.
00:14:44
Look, you've always got to protect the brand, right? And, and, and this is what I think brands have to do out the gate is who are you and who
00:14:52
are you not, right? Because the, the brands I worry about are the brands that are trying to be for everybody.
00:14:57
Right? Like, and I think you look at, look at a Yeti advertising or any ad Yeti does,
00:15:03
you know, that's a Yeti ad, right? Not to say someone at their desk in New York city isn't drinking their coffee
00:15:10
out of a Yeti, right? But they're probably not going to make it to a Yeti ad. Right?
00:15:15
And that's okay because Yeti knows who they are and knows who they're not. They're not excluding anyone.
00:15:23
They just, when it comes to the brand control, understand who they are. Same at AG1.
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We, we know who we are and, and who we're not, right? We're, we're, we're premium.
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We're very science focused. We, you know, athletes built our business, right? In that they adopted us early,
00:15:43
but it is, it is expanded. It's expanded to, to a much broader audience. So yes,
00:15:48
you'll always put a filter on, you know, who do you want representing the brand?
00:15:52
My, my point is that if you are really, as you know, love the brand and have seen the effects,
00:16:03
right? Well, then that's a pretty good start for us to have a conversation, right?
00:16:09
That's fair. But what I will say, like we found interesting things and this is, I think America's where,
00:16:15
where there is a bit of overlap between the, my, you know, the latest two brands I've had is I didn't think a lot of the
00:16:21
times also the brand shouldn't be too pushy on where it goes. It should let the people decide,
00:16:26
right? So I'll give you a good example. We actually have a large following in the mechanic space at AG1,
00:16:33
which I was, when I joined, I was like, this is, it's strange to me. And, and it's,
00:16:38
you know, it's not, it doesn't show elite athletes. You know, I don't know about this guys,
00:16:44
but what I did discover was these people obsess over what they do. They're professional about what they do.
00:16:52
They use their community to get answers. They're very professional in, in their approach to things and they need the focus,
00:17:00
right? And they need to stay on top of it, which AG1 gave them. So who am I to say you're not part of our family?
00:17:08
All right. When, when, when they take that on. Yeah. I mean, another way to build on America's this point,
00:17:14
I think going back to this podcast stuff, the podcast people that you, that you are working with have made significant commitments to your brand.
00:17:24
I mean, it reminds me a little of like Jason Kelsey and Travis Kelsey. This is one of the podcasts I listened to new heights and they invested in
00:17:32
garage beer because it's true to who they are and their members of their beer. Well,
00:17:38
what I understand from doing a little research here is that like Tim Ferris, who had that podcast,
00:17:45
he now invested in your company, believed in it so much. And Huber man, who, as you said,
00:17:52
is a professor at Stanford, a scientist. He's also come on to give medical advice to the company.
00:17:59
That, I mean, that's an interesting way to think about the relationship between podcasts and
00:18:05
a brand that they believe in. It's so much. It becomes part, becomes part of their life.
00:18:10
And that relationship gets tighter. It's a beautiful, it's a beautiful, it's a beautiful circle too,
00:18:18
because, you know, I, I think about Hugh Jackman, for example, right. Who we just did.
00:18:29
We just did a great campaign with on TV with, with, with Hughes amazing. And I love him for many reasons.
00:18:36
Not just because he's Australian, obviously, but, yeah. It's, you know, no one was confusing us on set.
00:18:46
Unfortunately, everyone knew who he was, you know, but you has been with the brand for six years.
00:18:56
Right. So what, what a great, a great, to your point, Barbara, like I don't have to force.
00:19:04
Or convince or, or kind of con anyone when I can use people who are absolutely wrapping their
00:19:11
arms around our products and vouching for it. Also, imagine you listen to a podcast that was repping a brand for five years.
00:19:20
And then all of a sudden they, they, they take a check for a competitor and they're selling.
00:19:27
How would you, how would you be? You'd be like, what happened here? Like, well, well,
00:19:33
you know, it just doesn't work that way. You, you need these people who, who are in emotionally invested,
00:19:41
if not financially invested in, in what you're doing. That that's spot on. I mean,
00:19:46
this is kind of where I was going also. And I thought it was where America's go was going.
00:19:50
Cause he always goes to this end on the metrics. It's like, how do you, you know,
00:19:56
I said like, what's different about podcasting advertising. And I've noticed this again in my own behavior is it's not like an
00:20:02
interruption the way ads are. It's really part of the podcast. It's part of the authenticity.
00:20:08
And that's why it's very important. Like you said that it's not fake because then all of that won't work.
00:20:13
It's gotta be something they really believe in. But then how, how do you measure?
00:20:18
Can you, can you measure the conversion rates from podcast advertising? Is it measured the way typically advertising dollars are measured?
00:20:27
Absolutely. Absolutely. And that's, it's another reason I really love the medium is because it doesn't
00:20:32
brand job and it does a growth job, right? Like, you know, you, you may think, well,
00:20:39
I listened to this podcast every week. So does everyone else, right? That it's the same community,
00:20:44
same group of listeners. So why would you keep spending into this? Everyone's heard your,
00:20:48
your, your ad week after week. Well, I like that. I like that from the brand. I'm not moving away from someone we're in a relationship here.
00:20:57
Right. And I don't want to just, I'm not going to love you and leave you. Right.
00:21:03
I, you know, I, I, I, I want, I want that conversation to continually go with all your,
00:21:11
your listeners, but there is a conversion aspect, of course, you know, it's, it's,
00:21:16
it's a great, it's a, it's a great channel. So that, so we measure it on both fronts,
00:21:21
you know, are we occupying the right, the right ears and minds and are we, and are we converting?
00:21:27
So, yeah, it's, it's a, it's a, it's a double-sided medium for sure. But people talk about metrics a lot with me.
00:21:35
I have a metric back to our CFO. Who's amazing, by the way, I, I will also, he is Australian.
00:21:42
So maybe that helps, but, but, and I had this metric to any, but the key KPI for me is energy.
00:21:51
Right. And people say, well, what the hell is that? Well, energy is, is the brand of interest to people.
00:22:00
And so when I turn up to one of our events, are people excited? We're there. Are people excited to talk to me?
00:22:07
Are other brands calling me during the week saying, Hey, man, like love what you guys are doing.
00:22:12
Can we do something together? Right. Metric kind of hand waving, but they also, they also have discount codes too,
00:22:22
that they can look at. This came from that podcast. That's right. Well, we're not stupid to make us,
00:22:28
you know, but, but, but understood, you know, you're right. You know, because you always say,
00:22:37
well, you've got to prove the financials of it to prove it. Well, okay. But what are your favorite brands?
00:22:42
And what are your favorite ads? I guarantee you, they're not performance ads. Right.
00:22:48
I guarantee you. It is a brand that means something to you. Right. And it's a brand that has separated itself from the other commodities in its
00:23:00
markets. But to my point, it's going to be very hard for you to convince people if they don't want to
00:23:04
be convinced of that in inside the building. So you've got to go back to this change of name.
00:23:09
And it's interesting when America said, you're obsessed with this change of name,
00:23:13
Barbara. I mean, it's a big thing for you. I like it. You said you changed it because the competitors came in and you didn't want
00:23:21
to focus on the green because it was more commodity and that you wanted it to be the number one thing,
00:23:26
everything altogether. Well, the other advantage, which is what America said, but it isn't what you said,
00:23:31
is that KFC moved away from their brand because they didn't want to focus on fried and,
00:23:38
and, you know, Starbucks coffee changed to Starbucks. So they got rid of the limitation on coffee.
00:23:44
That's another advantage you would have going from athletic greens to AG one. And I was wondering if that was part of the motivation at all,
00:23:52
because you now can go to, you're not limited to green liquid anymore. You can, if you're building a relationship with an athlete on wellness or nutrition with
00:24:04
a brand name like AG one, you can go to things that are purple, you know, I mean,
00:24:08
you don't have to be green anymore. Was that, was that part of it at all? I think,
00:24:14
you know, being future forward when you make these decisions is always a good plan.
00:24:19
Right. So for sure, somewhere down the road, it's a lot less limiting. Right. You don't have to be,
00:24:25
be so literal with things. A hundred, a hundred percent. I think that's, it's, it's a great thing to do.
00:24:36
You know, we do have a sleep product. We called it AGZ, which was, which was, was fun.
00:24:43
And it, and it's, it's an amazing, amazing product. But yeah, I look, I think having the flexibility in,
00:24:52
in, in naming and branding is smart. Like to your Starbucks point, it, it does open you up to be a brand,
00:24:59
not a product. Right. And I think that's, that's just, yeah. So just let me finish on that,
00:25:05
because one thing I think is incredible about AG1 is for 15 years, we sold one thing and one thing only,
00:25:12
and you could only get it D to C. Right. You can only get it online. And, and that takes incredible discipline for a brand.
00:25:21
You know, now we're in Costco and Target and, and, and we've got new flavors and all that stuff,
00:25:27
but the discipline of a brand to stay like that is incredible. And as we start to evolve,
00:25:34
obviously, and competitors came in, we, we saw a moment to kind of revitalize the brand a little.
00:25:39
Well, going along those lines, you know, now that you do have a broader umbrella and you're in the well,
00:25:45
I think it would define your business as in the wellness business. Right. And that is a growth industry beyond belief.
00:25:53
I mean, everybody's talking about the growth and wellness. So given that you're there,
00:25:57
you're at what, what do you see as the future? I mean, what, what are the trends?
00:26:01
What can you tell us from your inside viewpoint? Well, yeah, well, there's a lot of trends.
00:26:07
One thing, again, I would say the magic of this product is like, I think about GLPs,
00:26:13
right? GLP1s, I think is totally changing. I mean, let's just start with this country.
00:26:20
Right. I think it's changing how people eat. It's changing how people exercise. I think it's changing about how people,
00:26:25
what they shop for now. Right. I think it's really just impacting the marketplace in such a way that,
00:26:32
that we may have never seen before. Well, okay. Well, what happens when you get on a GLP?
00:26:39
Your, your gut is getting messed with. Well, what's AG1 all about? It's about gut health.
00:26:45
Right. And, and what else is AG1 got in it? Well, it's got a ton of nutrients. It fills nutrient gaps.
00:26:55
Well, what am I getting when I'm on GLP1s? Well, I'm not eating enough. Right. Wow.
00:27:00
So I think the future is, is, you know, we still got a lot of road to cover with our amazing product,
00:27:09
which, which, but for us as marketers, okay, well now how do we position? How do we talk?
00:27:15
How do we fight? You know, how do we interact? How do we stay true? They're all fabulous challenges for us.
00:27:21
Thankfully for me, I always say this, like go work for an amazing products. Cause like,
00:27:25
I'm not a good enough marketer to work at bad products. You know, like you gotta be,
00:27:29
you gotta be really good to market a bad product. So, you know, there's lots of opportunities within the sphere of the current products to,
00:27:39
to, to go after what we're seeing in the wellness space, because I actually think we were pretty ahead of the time with the product.
00:27:46
Everything's catching up, especially recognizing the advantage of podcasts and the advantage of,
00:27:51
of this wellness growth, which is like huge. But if you, if you've got some ideas and product ideas,
00:27:56
if you've got product ideas, but I send them my way, you know, it's been so much fun talking to you,
00:28:01
but we are at the end of your time. Thank you. Polly Derry, CMO at AG1. Thank you so much for joining us today.
00:28:08
And so where can our listeners go? I mean, if they don't either to these podcasts or where else can they go to find out
00:28:14
about your product? You can go to drinkag1.com, or you could pop into your local Costco or Target.
00:28:20
We will meet you there. And I, I hope you begin and enjoy your wonderful wellness journey.
00:28:26
Okay. Well, thank you very much. That's all we have time for today. And we'd like to thank our producer,
00:28:33
Jacob Grodd. And thank you all for listening today. We'll be back soon till then.
00:28:37
This has been marketing matters on the Wharton podcast network. I'm Barbara Kahn here with America's read.