Marketing and Leadership Lessons from 21Seeds Co-Founder Kat Hantas

Perhaps there is no greater indicator of a company's business success than being featured in a Harvard Business School case study.

Tequila newcomer 21Seeds was less than five years old when Harvard came calling last fall. It was also founded in 2019 by industry outsiders, brought into a notoriously crowded market, and acquired by spirits giant Diageo just three years after its launch. What is the key to success? It targets specific female consumers who have traditionally been underserved by male-dominated fields.

Co-founder Kat Hantas, along with her sister Nicole Emanuel and friend Sarika Singh, founded the company on the idea that women want spirits experiences that other brands don't offer. . Not only that, they believed that by having a fresh perspective, they could gain important insights that were missing from existing industry players. “We were outsiders both from a gender standpoint and from a spiritual standpoint, so we were able to see that landscape as well,” she says. “We were able to understand the current state of the market and see holes in the typical ways people reach consumers.”

For 21Seeds, the result is a lower-strength spirit (40% ABV vs. 35% ABV) with flavor infusions designed to pair well with popular tequila cocktails like the Spicy Margarita, Paloma, and Traditional Margarita. ) was born. Key differentiator: The spirit was smooth, not sweet.

“Women don't necessarily like things to be tough, right?” Hantas says of her initial inspiration. (After the acquisition, Diageo retained the three founders as brand ambassadors.) “But the spirits industry's answer to that, from my perspective, is to give it something sweet. 'Make it really sweet. , and it'll taste better.'' And the reality is, that's not what we want. ”

21Seeds' target consumer (30- to 40-year-old working women who buy alcohol at grocery stores) agreed from the beginning. 21Seeds sold 66,000 cases in 2021, a significant increase from about 17,000 cases in 2020 and about 1,800 cases in 2019, when it was released. This was a significant feat for smaller brands that lacked marketing dollars and recognition from global rivals.

A Harvard Business School case study found that 21 Seeds offered a refined, low-calorie, low-alcohol spirit that was less sweet, and gradually moved away from traditional spirits marketing strategies. Pointed out. Most spirits brands focus on building awareness in on-premise stores (bars, restaurants) and then focus sales off-premises (liquor stores, grocery store chains). When the brand launched, it was just a startup with little name recognition. Bars and retailers alike were skeptical of new brands seeking space on crowded shelves.

But 21Seeds did something unexpected. Convinced they had identified a niche for their new product, the founders developed a digital-forward marketing campaign that targeted where consumers found information. This includes social media advertising, partnerships with media brands such as PureWow and his Refinery29, which have large female fans, as well as advertising on his Pinterest, a channel often ignored by traditional marketing. Masu.

Word of mouth quickly spread after its release. Within his year since debut, 21Seeds was fortunate to receive free and organic support from celebrities such as Katie Couric and Oprah Winfrey. “It was real, wasn't it?” Hantas says. “It was capitalizing on a movement that was already happening. But also, throughout that period, we were always thinking about what's next. [our customer] First and foremost. ”

Are there any lessons that can be applied to other women looking to advance in traditionally male-dominated fields, whether as founders or executives?

“As a spirit develops within an industry, there are many iterations and at some point someone has to give final approval, right?” says Hantas. There may be some energetic women on development and innovation teams, but whether they have final say over the finished product is an open question. “Let’s let more women have the final say with a can-do spirit.”

She added that established players, whether in the spirits industry or other industries, tend to stay within their strategies. “These incumbents are just busy doing their jobs,” she says. “For newcomers, there's a huge opportunity to focus and zero in on what's actually happening.” Real-life observations, such as observing how consumers interact with products, are key, she said. Point out. “Spend some time where real transactions are happening. Go to a retail store and stand in the aisles to see how consumers shop. They have a budget and it takes a lot of time to pick something and put it in the cart. Just because something is new doesn't mean they want to try it.”

She added, “There's so much we can all learn just by being in the buying field and seeing what's actually going on.”