Framework
Launch the product before it exists, Liquid Death style
Sam compares the milk bomb to Liquid Death, whose founder launched the brand before having product — run Instagram/Facebook ads, gauge response, build hype, then ship the final product once demand is proven.
“It reminded me a little bit of the Liquid Death guy, and he launched that product without having the product, and I can see someone launching this without having the prototype. Put up Instagram ad, Facebook ad, see the response, get the hype going, and then get the final product out there.”
Steal thisLaunch a brand and ads before the product exists; validate demand and build hype, then produce it.
Framework
Customer-first branding: find the audience no brand speaks to
Shaan's branding playbook from the Liquid Death and Gatorade examples: start with a specific customer, ask whether any existing brand in the category fits that customer's lifestyle, and if not, build the brand that speaks to them. Gatorade refactored medical-looking electrolyte drinks into 'what top athletes drink'; Liquid Death did it for water with no fun, punk brand.
“And then Gatorade came out and just refactored that same thing with the brand of, this is what the top athletes in the world, in the world drink. And then, you know, there's— so you just take a customer first. And then you say, okay, to this customer, is there already a brand in this category that speaks to that customer, that fits that customer's lifestyle? And if not, go for it.”
Steal thisPick a specific customer, check if any brand in the category speaks to their lifestyle, and if none does, build that brand.
Framework
Do anything different in a mass-consumption category and you win
Shaan explains why he flipped from thinking Liquid Death was dumb to wanting to invest: water is the definition of a mass-consumption product, so doing anything genuinely different and capturing even a tiny percentage of that population creates a meaningful business.
“So he's taking a mass product, like bottled water or canned water is a mass product. Water is the, like, you know, the definition of a mass consumption product. Then the second thing is, if you just did anything different in the water space and it latches on with any small percentage of that population, you're going to have a meaningful business.”
Steal thisEnter a giant mass-consumption category and differentiate hard; capturing a sliver of a huge market is enough.
Framework
Brand the healthy thing with junk-food marketing energy
Liquid Death's core insight: the funniest, most memorable ad campaigns of the last decade (Bud Light, Dos Equis, Doritos, Red Bull) all come from junk food and alcohol, while healthy products are marketed quietly to moms. The play is to take the healthiest thing you can drink and brand it with the fun usually reserved for unhealthy products.
“most of the most hilarious, memorable ad campaigns that you ask most people about of the last 10 years, they'll tell you Bud Light, Dos Equis, Snickers, Doritos, Skittles, like all junk food and alcohol. That's the funniest, most memorable kind of youth culture owning and energy drinks like Red Bull.”
Steal thisFind a healthy product marketed quietly to moms and re-brand it with the irreverent, fun energy that junk-food and alcohol brands own.
Take
Truly innovative ideas seem comical at first
Mike cites Reid Hoffman's point that genuinely innovative ideas look laughable at first, because anything that obviously makes sense already has four companies five years deep into it. Liquid Death's absurd premise was itself a signal it was differentiated.
“truly innovative ideas are almost comical at first because if it seems like it makes a lot of sense right now, it probably means there's 4 other companies that have been working on it for 5 years already. It's like the things that are truly unique and innovative, like almost don't make any sense at first or seem laughable.”
Take
Truly innovative ideas seem comical at first
Mike cites Reid Hoffman's point that genuinely innovative ideas look laughable at first, because anything that obviously makes sense already has four companies five years deep into it. Liquid Death's absurd premise was itself a signal it was differentiated.
“truly innovative ideas are almost comical at first because if it seems like it makes a lot of sense right now, it probably means there's 4 other companies that have been working on it for 5 years already. It's like the things that are truly unique and innovative, like almost don't make any sense at first or seem laughable.”
Framework
Brand as a pro wrestler: it's theater and everyone's in on it
Mike describes Liquid Death's brand voice as a professional wrestling character. No one believes The Undertaker is really an evil dead guy who likes metal, and no one needs to believe Liquid Death is serious. The fun is in choosing to play along with the character.
“The way I like to think about our brand is like we're a professional wrestler Like it's all theater and fun and no one thinks it's trying to be real. Like no one thinks The Undertaker is really an evil guy from the dead who likes metal. No, it's a character and it's fun to like have a character.”
Take
Your marketing competes with everything awesome on the internet
Mike's core marketing principle: a brand's social post isn't competing against other beverages, it's competing against uncensored influencers, movie trailers, and everything else amazing in someone's feed. The bar is therefore far higher, so marketing must feel like entertainment, never like marketing.
“your little social posts aren't just competing against other beverages, you're competing against influencers who are uncensored and can do crazy off-the-wall stuff. You're competing against movie trailers, you're competing against everything awesome on the internet when you're scrolling through your feed. That's what your marketing is competing against.”
Steal thisSet the bar for every post against the best content on the whole feed, not against your category. If it isn't share-worthy entertainment, don't ship it.
Number
Fastest-growing water brand in Whole Foods despite 80% less traffic
Liquid Death launched nationally in Whole Foods on March 15, 2020, the day the pandemic hit. Even with roughly 80% decreased store traffic, it became the fastest-growing water brand in Whole Foods.
$80
Whole Foods store traffic decrease during launch · percent
“even though we've been in a pandemic where they've had like 80% decreased store traffic and everything else going on, we've had insane growth in Whole Foods and we're now the fastest growing water brand in Whole Foods right now.”
Story
The 'tour water' moment that sparked Liquid Death
At a 2007 Vans Warped Tour, Mike noticed bands pounding what looked like Monster cans in 98-degree heat. They were actually 'tour water' that Monster supplied in look-alike cans, because bands wouldn't drink energy drinks in the sun. That gap between cool packaging and a healthy product became the aha moment for Liquid Death.
“Monster gives all the bands— they look like Monster cans, but at the bottom it says tour water because they know, right, none of these bands are going to drink this stuff in the sun. So bands on stage are pounding what look like energy drinks to all these kids, but it's really just water. And I remember thinking like, that's so fucked up.”
Story
Liquid Death launched on Facebook before it had any product
Knowing no one would fund a 'negative name' water brand, Mike de-risked it by proving the concept on social first. A $1,500 video plus ~$3,000 in Facebook ads got 3 million views and more followers than Aquafina in three months, plus inbound DMs from 7-Eleven franchisees and major NYC distributor Big Geyser, all before any product existed.
“We shot a $1,500 video and then We just put it on Facebook, no Twitter, no Instagram, just Facebook. We put maybe, I don't know, $3,000 in paid media behind the video. And then cut to 3 months later, we have more Facebook followers than Aquafina. The video has 3 million views.”
Steal thisValidate a risky product as a concept on social media before you build inventory; use the traction to de-risk the raise.
Number
The US bottled water market is $20 billion a year
Mike sizes the opportunity: in 2019 the US bottled water market alone was $20 billion, with still water just under $15 billion and sparkling about $3.5 billion. Convenience stores are the largest channel by doors at over 150,000 locations.
$20000M
US bottled water market size (2019) · USD/year
“the bottled water market in the US alone was $20 billion for just bottled water. Wow. Still water made up a little under $15 billion of that $20, and sparkling is about $3.5 billion.”
Fact
Beverage margin benchmarks: 40% solid, 50% killing it
Mike gives a rule of thumb for beverage gross margins: around 40% is a really solid margin, 50% means you're killing it, and 30% is about the low end of what you'd want. Bottled water is actually lower-margin than you'd expect because retailers and distributors take the most markup.
“a target, like really solid margin for beverage would be like 40%. That's like 50% is like you're killing it. And then it's like, I think you get down like to 30 is probably like on the low end of what you'd want.”
Take
Profitable marketing: build experiences instead of buying ads
Mike's spend philosophy: a $500K Oscars TV spot buys one 30-second moment, but the same $500K could build a chain of five heavy-metal yoga studios in LA that earn press, photos, and word-of-mouth, and might make money back. Stunts and side-products double as marketing that's actually profitable.
“What does $500 grand buy you if you try to run one TV spot during the fucking Oscars? Like maybe you get a 30-second spot and what's gonna see more lift and brand evangelism for your brand? Running one $500,000 commercial during the Oscars or building a chain of 5 heavy metal yoga studios in LA that gets talked about by every publication.”
Steal thisRedirect ad budget into ownable experiences or products that generate press and word-of-mouth and can earn their cost back.
Take
Profitable marketing: build experiences instead of buying ads
Mike's spend philosophy: a $500K Oscars TV spot buys one 30-second moment, but the same $500K could build a chain of five heavy-metal yoga studios in LA that earn press, photos, and word-of-mouth, and might make money back. Stunts and side-products double as marketing that's actually profitable.
“What does $500 grand buy you if you try to run one TV spot during the fucking Oscars? Like maybe you get a 30-second spot and what's gonna see more lift and brand evangelism for your brand? Running one $500,000 commercial during the Oscars or building a chain of 5 heavy metal yoga studios in LA that gets talked about by every publication.”
Steal thisRedirect ad budget into ownable experiences or products that generate press and word-of-mouth and can earn their cost back.
Framework
Marketing is day-trading attention
Mike credits Gary Vaynerchuk for the frame that marketing is really day-trading attention: attention has a different price depending on where you buy it. A billboard overpays per eyeball, while a stunt like an LA yoga studio can generate more attention at far lower cost. Always hunt the most cost-efficient source of attention.
“marketing is really just about day trading attention. Like it's marketing's all about attention and attention has different cost to it and different price to it depending where you go. The price for a billboard, you're paying so much per eyeball that sees it.”
Steal thisTreat attention like an asset class: compare cost-per-eyeball across channels and buy where it's underpriced.
Idea
Liquid Death: sell water by selling a brand and a use case
Liquid Death is canned water with heavy-metal branding, built so people opting out of alcohol still get something cool to hold. The play is to manufacture a brand and social use case around a commodity.
“how the hell are you gonna sell water? Well, you have to create a brand and a story around it and almost a use case.”
Steal thisWrap a commodity product in a brand and a social use case so non-drinkers still have something cool to hold.