Celebrity

Is the initial advantage of a celebrity brand sustainable?

Editor’s Note: Thanks to Amrit Richmond for the conversation that sparked this week’s topic.

This morning, a week to the day after everyone was talking (again) about creator- and celebrity-led brands, a two-and-a-half pound box of Mr. Beast’s Feastables variety pack sat on my dining room table.

It looked a little out of place, honestly, but where else are you supposed to store 18 chocolate bars?

We bought it last Saturday when Mr. Beast announced it, partially out of novelty and and partially out of curiosity. (And, besides, if Mr. Beast can be a real-life Willy Wonka and give away a chocolate factory, then it stands to reason that my son, Charlie, can be a real-life Charlie Bucket.)

But we haven’t much touched it. We don’t eat many chocolate bars in this house, and that, it occurs to me, is a problem—mostly for me, but maybe for Mr. Beast, too.

On its face, the concept of the creator-led brand makes perfect sense: an already established brand with an already established audience and already established feedback loops means the creator has an unfair advantage.

There’s no debating the initial advantage. But if launch sales of creator-led brands is rooted in interest in the creator and not interest in the category, how sustainable is that advantage?

New brands in existing categories largely gain popularity first among heavy category buyers, because the brand has limited reach and is most likely to be discovered by buyers who are willing to more deeply explore the category.

Though these smaller brands are less popular than larger brands, they can have strong product-market fit among early customers and can reasonably assume a level of repeat purchases that will grow over time as reach grows. This creates the possibility of a favorable growth trajectory for the brand.

A creator-led brand, arguably, swings this dynamic in a way that’s potentially harmful for the brand: Acquiring a bunch of non-category buyers leads to sky high initial sales, but less product-market fit among those early customers. This “pop,” then, reduces the likelihood of repeat purchases and creates the possibility of a low or declining growth trajectory.

Creators and celebrities, though they have an initial distribution advantage, do not solve the core problems of business on their brand alone. The fundamentals still matter.

Perhaps a strong illustration of this is Travis Scott’s now-discontinued hard seltzer line, Cacti: When it launched in March 2021, it grabbed more than 3% market share. It had just 1.1% of market share at the end of last year, when Anheuser-Busch InBev announced that it was ending its partnership with Scott and folding the brand.

No doubt, other factors came into play here, but Cacti, which primarily traded on Scott’s brand, had a trajectory was headed in the wrong direction.

Early on, that’s what matters. And it’s just as hard—maybe harder—for a creator-led brand to get right.