Sanzo, a sparkling water brand, completely inverted its sales model during the COVID-19 pandemic, shifting from 70-80% wholesale to a highly successful DTC approach. Founder Sandro Roco capitalized on depressed ad costs and increased consumer willingness to order CPG online, scaling subscriptions and leveraging powerful digital advertising. This episode offers key lessons on rapid adaptation, optimizing digital channels, and balancing omnichannel strategies in a crisis.
Key takeaways
Sanzo's sales rapidly inverted from 70-80% wholesale to predominantly DTC during the pandemic due to shifting consumer behavior and online ordering trends.
The initial months of the pandemic (March-April 2020) presented an unprecedented opportunity for digital marketers with powerful targeting (Facebook/Instagram) and exceptionally low CPMs.
Sanzo successfully reactivated its DTC playbook, focusing on online sales, subscriptions, and leveraging partnerships like Iris Nova's text-to-order platform.
Implement a flexible omnichannel strategy, as Sanzo did by maintaining wholesale while aggressively scaling DTC, to adapt to market shifts and maximize reach.
Recognize and swiftly act on external factors (e.g., depressed ad costs, changing consumer habits) to gain a competitive advantage in digital acquisition.
Rethink inventory management and supply chain to facilitate a rapid shift to ecommerce, ensuring products are available where demand is highest.
Before the pandemic, the zero (or low) sugar beverage brand Sanzo had all the scrappy upstart charm and aesthetic of a DTC brand. But, it still sold mostly through wholesale -- 70 to 80%, in founder Sandro Roco's estimate.
That's changed. "Since the pandemic, it's completely inverted, and even more extremely so," Roco said on the Modern Retail Podcast. "During this pandemic, if you're looking at CPG sales and specifically sparkling water, a lot more folks are willing to order sparkling water to their home than many other CPG categories."
That's good for Sanzo, which sells 12-packs of "Asian-inspired sparkling water" online, where subscriptions are possible, but also through bodegas, grocery stores, and soon, 50 Whole Foods outlets in the Tri-State area.
Depressed advertising costs at the start of the pandemic led the company to "dust off the DTC playbook pretty quickly," according to Roco.
"I don't know that there will ever be an opportunity for a digital marketer like what we had in March and April," Roco said. "You had the combination of the powerful targeting that Facebook and Instagram have to offer -- which, obviously there's a whole other consumer conversation around data privacy and what not, but at least to a marketer, it's still a very robust advertising engine -- with also CPMs or ad rates that you've just never seen on this platform."
Sanzo has also partnered with the Coca-Cola backed Iris Nova, through which it's benefitted from their text order platform.
Sanzo's sales rapidly inverted from 70-80% wholesale to predominantly DTC during the pandemic due to shifting consumer behavior and online ordering trends.
What does this episode say about paid acquisition?
The initial months of the pandemic (March-April 2020) presented an unprecedented opportunity for digital marketers with powerful targeting (Facebook/Instagram) and exceptionally low CPMs.
What does this episode say about supply chain & operations?
Sanzo successfully reactivated its DTC playbook, focusing on online sales, subscriptions, and leveraging partnerships like Iris Nova's text-to-order platform.
What does this episode say about brand & content?
Implement a flexible omnichannel strategy, as Sanzo did by maintaining wholesale while aggressively scaling DTC, to adapt to market shifts and maximize reach.
What does this episode say about dtc strategy?
Recognize and swiftly act on external factors (e.g., depressed ad costs, changing consumer habits) to gain a competitive advantage in digital acquisition.
