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Hydro Flask case study

Jesús Zamora

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Nov 24, 2017
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So a couple of months ago a saw a friend in class with one of this things, "looks cool" I thought, some days later my girlfriend tells me she wants to buy one, "hmm that's a coincidence" I reckoned. Now, I live right next to San Diego, so this may be a Cali trend, but my God, I began to watch this water bottles EVERYWHERE



I shit you not, it seems that everywhere I go, someone is carrying one of these, and its getting worse every time. Since these water bottles seemed to me to appear out of nowhere to become the latest trend, I decided to dig a little deeper, first thing I find out, they are EXPENSIVE (between $30 and $60). This caught me off guard, how did this guys manage to sell so much, at a more expensive price, and become so popular in a market that I always viewed as saturated?

I continued with my research. As it turns out, the company uses an old technology used in thermos called "double wall insulation" that makes the contents of the water bottle remain cold for 24 hrs or hot for 6 hrs. It also appears that they are famous for their colorful designs and their products include a life long warranty.

This is all very nice, however I still find myself scratching my head wondering how did this guys pulled this off. I see the value skew (having your beverage remain hot/cold for extended periods time, cool designs, life-long warranty) but I still can't seem to connect the dots for almost 50% increased price and an explosive popularity. Perhaps the lesson here is that, as always, the market has the final word, and that maybe you should not throw away an idea based on your personal view on it (I wouldn't buy this / I wouldn't use it/ Its not good enough / etc...) but you should rather present it to the market and let it decide.

On a side note..

I also researched about the founder, Travis Rosbach, and this guy is an absolute Fastlane success!!! . He sold Hydro Flask 7 years after he founded it for $210 million. Started the company in his 30's, did not know anything about manufacturing of water bottles at the time, had to move back with her mother to pay for the first batch of hydro flasks, his then wife and co-funder leaved him while they were running the company and he persevered, I think that's the smell of process..


Anyway, what do you guys think? Was the value skew on the core components of the product?, the designs?, the marketing? All of it? What valuable lessons did you get from this? I would love to hear about it!
 

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Jesús Zamora

Jesús Zamora

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Nov 24, 2017
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i got 2, i like the lid and design and texture lol

oh and they really keep the temperature well.
All their buyers seem to really like it, so it’s not like they are value cheating or something. Might even buy one myself to see what the fuss is all about
 

luniac

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All their buyers seem to really like it, so it’s not like they are value cheating or something. Might even buy one myself to see what the fuss is all about
honestly its the first flask i ever bought, i was googling around and theirs seemed the best. The price seemed reasonable too but im no expert, besides its supposed to last like forever aint it?
 

Xeon

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From my brief research into these things just now (never even heard of Hydro Flasks before, I guess I'm old), it seems they got success from a combination of methods, not just one:

1) Product started picking up around 2014, the time when Instagram went mainstream and influencers started appearing, and the app was no longer just confined to photographers. Hydro Flask (HF) capitalised on this. Google Trends shows this:




2) From several articles, it appears these guys have tons of cash to burn (investor-funded).
For them to be able to get onto shelves worldwide, so fast, suggests the investor has powerful connections to make this happen.

3) The REAL KEY : HF likely gained real traction when they started marketing it to college kids : College culture: Hydro Flasks, Birkenstocks and Macbooks - The Stanford Daily

It's like the "Apple" of the water bottle world. They're selling it as a status symbol. Their technical features (such as double insulation and all that shit) are not a big deal, it's boring even. But by selling it at $60 and having all the "cool kids" in high school and college have one, it got desired by the rest. And to make it happen, I won't be surprised if they have college ambassadors to help make this happen.

Alison, the 5'10 hot Amber Heard-lookalike from Class X, who surfs at the beach and grooves with the city's most famous DJs on trips to mad hot parties on the beaches at Barcelona, has a HF.

Josh, the 6'12 rugby guy, who has 3 different girls hanging on his arms every day, drinks from a HF.

And in that college alone, there's many Alisons and Joshs. Want to be like these cool instajanes and douchebros? The easiest way to rub some of their glitter onto yourselves is to get a HF.
Because everyone else already has a Macbook Pro, iPhone and carries a Starbucks cup in their right hand.

An interesting article: What's a VSCO girl? Shop the latest teen trend

In all trends, things ALWAYS start from the young crowd and grow to encompass the older crowd : Facebook and Pokemon Go is a good example (for Pokemon Go, not sure what it's like in other countries, but at least here, it seems nowadays the middle aged boomers are the ones playing PoGo and not the young kids anymore lol).

4) Look at HF's web stats on Similarweb:



They've a heavy Youtube presence. Surprisingly, their IG despite having 660K+ followers and decent engagement for a brand actually got listed as last.



And looking at their Audience Interests above confirms their main market audience are college kids.
If you go to their Instagram page, click on a few of their posts, read the comments, you'll see at least 99% of their fans are young white chicks.

5) I'm pretty sure HF is a fad though. From looking at Google Trends and Similarweb, their numbers seem to be going down.




Looking at these stats, it seems to say that when HF gets introduced to a new country, it gets popular, but after a while when it reaches a "plateau" (pretty fast, I say), it starts to decline.

Philippines is probably getting started with HF but a couple years later, it'll probably go down like CA and UK. Again, these numbers may be also affected by heavy advertising. E.g: probably bumped up ad spend in the US due to Black-Fri-Cyber-Mon, and probably spent less on ads in UK.

I'm not a fan of their bottle shape though. The colors are cool, but personally I feel something like Sw'ell bottles look more pleasing (but are very hard to clean properly).

5) Other factors, such as riding on the greenwashing / wokewashing trend which is big among Gen Z and millennials.

omg, your using plastic bottles? how can you? like, um, they kill turtles and sharks, they're killing our environment. omg omg loook!!!! these metal hydro flasks r sewww fire and hard!
we highkey need to get em now mmkay?!
 

PizzaOnTheRoof

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Seems like any other double walled insulated cup.

Yeti, Artic, Kodi, Contigo, Ozark, Thermos, Grizzly, etc...
 

iizu

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I think Klean Kanteen was the first to market with Stainless Steel bottles, but they were late in the game with insulated bottles. Also they have more of a outdoors/hippy-vibe.

Now there about million variations to choose from. Nobody makes water bottles without insulation no more.

omg, your using plastic bottles? how can you? like, um, they kill turtles and sharks, they're killing our environment. omg omg loook!!!! these metal hydro flasks r sewww fire and hard!
we highkey need to get em now mmkay?!
There was a big story on chemicals leaching in to water from plastic bottles, about 10 years ago. This caused Canada to ban certain kinds of plastic bottles, which led to rise of Klean Kanteen.

Those chemicals are no joke. Most of them act like estrogen in your body. I've long ago switched to steel/glass/ceramic if possible.
 

Xeon

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There was a big story on chemicals leaching in to water from plastic bottles, about 10 years ago. This caused Canada to ban certain kinds of plastic bottles, which led to rise of Klean Kanteen.
Those chemicals are no joke. Most of them act like estrogen in your body. I've long ago switched to steel/glass/ceramic if possible.
Yup, that incident hit most of the countries, and then they started the BPA-free water bottles thing.
But even then: Why 'BPA Free' May Not Mean a Plastic Product Is Safe
 

iizu

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Yup, that incident hit most of the countries, and then they started the BPA-free water bottles thing.
But even then: Why 'BPA Free' May Not Mean a Plastic Product Is Safe

Excactly. Nobody knows what is the final chemical composition of any plastic. There are hundreds of additives and the big chem corporations don't give a a shit.

@Jesús Zamora , I see you're located in Mexico. It would be interesting to see made in Mexico SS water bottles. Now they are 95% made in China or Vietnam. Actually you can buy a complete manufacturing line for these bottles from China. For example this machine is meant for forming the neck on SS bottle.
 

Invictus

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Seems like any other double walled insulated cup.

Yeti, Artic, Kodi, Contigo, Ozark, Thermos, Grizzly, etc...
It seems specifically like it's the white collar version of Yeti.
 

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foodiepersecond

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Yup, that incident hit most of the countries, and then they started the BPA-free water bottles thing.
But even then: Why 'BPA Free' May Not Mean a Plastic Product Is Safe
I thought they backpedaled on BPA actually be harmful?

Either case, I am curious how this goes head to head with a Yeti. The Yeti is the only cup I know to actually hold ice for a day or 2 while sealed up.
 
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Jesús Zamora

Jesús Zamora

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Nov 24, 2017
11
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21
México
3) The REAL KEY : HF likely gained real traction when they started marketing it to college kids : College culture: Hydro Flasks, Birkenstocks and Macbooks - The Stanford Daily

It's like the "Apple" of the water bottle world. They're selling it as a status symbol. Their technical features (such as double insulation and all that shit) are not a big deal, it's boring even. But by selling it at $60 and having all the "cool kids" in high school and college have one, it got desired by the rest. And to make it happen, I won't be surprised if they have college ambassadors to help make this happen.
I also think that's the main thing, even though apparently its functionality its legit, I get the sense that most people buy HF because of the status it symbolizes. And you are totally right, in my university the "cool kids" started posting photos with HF on Instagram and carrying them everywhere and from there it spread like the plague. I just find really interesting the way these guys were able to position themselves as a "cool kids" brand. Maybe (probably) it has something to do with the fact that, as you mentioned, they had a lot of capital to throw into marketing and PR.


Just have to send some big respect to @Xeon that was the most impressive breakdown I've read in a long time! Kudos to you for putting so much effort into crafting such a detailed response!
Agree!! Awesome breakdown @Xeon
 
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Jesús Zamora

Jesús Zamora

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Nov 24, 2017
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Seems like any other double walled insulated cup.

Yeti, Artic, Kodi, Contigo, Ozark, Thermos, Grizzly, etc...
I've always been a customer of Contigo. And I agree, I don't see anything really different from a HF compared to my everyday Contigo water bottle.
 
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Jesús Zamora

Jesús Zamora

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Nov 24, 2017
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Excactly. Nobody knows what is the final chemical composition of any plastic. There are hundreds of additives and the big chem corporations don't give a a shit.

@Jesús Zamora , I see you're located in Mexico. It would be interesting to see made in Mexico SS water bottles. Now they are 95% made in China or Vietnam. Actually you can buy a complete manufacturing line for these bottles from China. For example this machine is meant for forming the neck on SS bottle.
It would indeed be, I've heard of a couple plastic bottle manufacturers in Mexico but no one (that I've hard of) is currently making SS ones. I'll dig more into it. Are you thinking manufacturing the SS bottles here to then sale them to a brand in the US or actually create a brand and do the manufacturing here instead of sourcing to China/Vietnam?
 

Xeon

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in my university the "cool kids" started posting photos with HF on Instagram and carrying them everywhere and from there it spread like the plague. I just find really interesting the way these guys were able to position themselves as a "cool kids" brand. Maybe (probably) it has something to do with the fact that, as you mentioned, they had a lot of capital to throw into marketing and PR.
There was this trick I read about last year, I think (not too sure) it was taught by Daymond John (the Shark Tank guy).
He was saying that to make something look as if it went viral, in order to get people to buy into it and further snowball the virality to make it truly viral, is to give a handful of products to a lot of people, have them take the photos and then pass the product to the next person, and so on.

So, in the case of a t-shirt example (he was using that as a product), to do so in a cost-effective manner, you can get all your friends to wear the same few t-shirts, take pics, post on social media, then pass the t-shirt to the next person, they wear it, take pics, post on social, then pass to the next guy.
Then, have all of them post the pics at around the same time period.

When you see all of these people suddenly wearing the exact same t-shirt design this week, you'll start to wonder, and many others will start to talk about it ("is it some kind of movement?", "what is going on??!!"). Eventually, as a bonus, even the news may pick up on it, and once it's in the news, BAM. Explosion.

Of course, with HF, since they've lots of $$$, they probably contacted hundreds of college-age influencers on social media, and did the same thing with them. Let's say these are small time influencers with 10K followers. 300 of these will be 3 million. And that's not including those followers who reshared the posts with their friends, leading to even more eyeballs and views.

And because college communities are closely knitted and word gets around fast,.....well, the rest is history.
 

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