Source: Velvet Caviar
I spend a lot of time thinking about how expensive it has become to build a consumer brand, especially as I've really gotten back into investing this year and have seen lots of P&Ls. Between paid media, influencer marketing, PR, events and the actual cost of making a product, it is insane how much money a company can actually spend before it even knows whether someone is going to buy what it's selling.
And influencer marketing is one of the most interesting expenses to me because the economics can be so wildly different depending on what you're selling.
Which brings me to a brand that clearly has mastered this model. Founded in 2014, Velvet Caviar has grown from a phone case company into a fashion tech accessories brand with more than 250,000 customer reviews and distribution across 18,000+ retail doors nationwide.
For its latest iPhone 18 launch, the brand hand-delivered its new collection to 50 creators across New York and Los Angeles. Instead of another PR mailer, a custom Sprinter van brought champagne, caviar and live unboxings directly to creators like Morgan Riddle, Victoria Paris and Halley Kate.
And they knew what they were doing because it resulted in more than 37 million organic views and 50+ posts, with no contracted creators or paid placements.
Now, I don't think the takeaway here is that brands should start sending champagne and caviar to influencers in Sprinter vans but here's what we're going to get into:
The number one problem founders are calling me about right now (Velvet Caviar has figured out), and the advice I’m giving them.
Why some brands can get millions of organic impressions without paying influencers. And what makes certain products particularly valuable to gift to a creator that they’ll accept.
When is it actually better to pay influencers than gift them products? The economics behind both strategies, and how I'd decide where to spend my marketing budget.
Does free marketing actually make for a better business? The trade-off I'd consider as an investor, and why brands spending more on marketing might actually be the better businesses to own.
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