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Tanner Montague came to town from Seattle having never owned his own music venue before. He’s a musician himself, so he has a pretty good sense of good music, but he also wandered into a crowded music scene filled with concert venues large and small.But the owner of Green Room thinks he found a void in the market. It’s lacking, he says, in places serving between 200 and 500 people, a sweet spot he thinks could be a draw for both some national acts not quite big enough yet for arena gigs and local acts looking for a launching pad.“I felt that size would do well in the city to offer more options,” he says. “My goal was to A, bring another option for national acts but then, B, have a great spot for local bands to start.”Right or wrong, something seems to be working, he says. He’s got a full calendar of concerts booked out several months. How did he, as a newcomer to the market in an industry filled with competition, get the attention of the local concertgoer?

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by Andrew Tellijohn
October 2007

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Mundane to marvelous

COVER STORY

Mundane to marvelous

Caldrea Co.’s CEO Monica Nassif gained shelf space for a new kind of cleaning product by watching consumers carefully, then fiercely guarding gains against dominant competitors. Her experience building the company is a textbook case in brand creation.

by Liz Wolf

MONICA NASSIF says she had an epiphany in the middle of a big-box retail store ? in the household cleaning products aisle, of all places.

“I’ll never forget it. I looked at this pallet of cleaning products,” she recalls. “All of the bottles were cockeyed and tipped over. The packaging was hideous. I remember turning my head and going, ” ‘I hate that category. I hate everything about cleaning. I hate the packaging. I hate the toxicity.’ ” I always thought I was going to kill my kids and my cat.

“I would never leave the products out, and I hated the smell. And I remember thinking why can’t cleaning products be fabulous ? like buying your favorite skincare products?”

“It was just a huge disconnect with the consumer for me,” says Nassif, 51.

Nassif saw a big opportunity in the marketplace for premium, eco-friendly cleaners, but before she could reinvent the category, she needed to fully understand it. She discovered that household cleaning products is a $12 billion business in the United States alone.

“Procter & Gamble is $68 million globally,” she says. “But when you start to look at these companies, you realize it’s a huge, tired commodities market ripe for reinvention. That’s how I thought about it. I thought if we could just tear off a small corner of a $12 billion industry, we would have a sizeable business.”

She also looked at what was happening at the luxury end of other products and put her marketing cap on. Nassif had extensive experience in retail and branding, having worked as a marketing executive for Target Corp. and later co-founding marketing design firm Kilter Inc.

“You see how commodities can move from mundane to really marvelous purchases,” she explains. “That’s how I thought of cleaning. Other people had gone there before us – coffee, pet food, shampoo. Other categories had said, ‘This is a tired commodities category, although highly consumable.’ “

Nassif was determined to turn the household cleaning industry upside down by creating an upscale, biodegradable line of beautifully packaged, all-purpose cleaners, dish soaps, countertop sprays and powdered cleansers featuring aromatherapy qualities. She wrote a business plan and launched Caldrea Co. in late 1999. (Caldrea is a combination of her daughters? names ? Calla and Aundrea).

Another pioneering concept was she wanted one consistent fragrance for her cleaners versus competing fragrances offered in traditional products. (At P&G, for example, Tide has one fragrance, Dawn another and Windex yet another).

?Mass players took one item and just pounded it through to the consumer,? she says. ?I didn?t think the consumer views her home like that. Why can?t she have everything in lavender? The fragrance should be as fabulous in her dish as it is in her window as it is in her laundry.? (Caldrea?s fragrances include green tea patchouli, lavender pine and citrus mint).

Nassif researched the industry?s giant players, considered price points and looked at how she could go to market differently. She studied, traveled and hung out in stores? cleaning product aisles.

?I do remember once being asked to leave The Wedge,? she recalls, referring to the popular Minneapolis co-op. ?When you work in retail, you?re always analyzing ? why do they get so many faceouts, what are the price points, what?s a good, better and best strategy?

?I spent a lot of time in stores taking copious notes and photographs, trying to figure out, ?OK, this is the opening price point.? I did all of this analysis of price per ounce. All of the intelligence ? in my opinion ? comes from the consumer, so if you can understand what?s on the shelf, you can figure out how you?re going to wedge in.?

Wedging in, Nassif admits, is challenging. ?If you own a store, I?m going to say, ?Hey, you have to bring in my product,? ? she says. ?All they?re thinking about is, so who are you kicking out? Because any time you bring in something new, you have to think about how to get them to kick somebody out for you. They don?t add on a wing, because you?ve got something new. So you have to be really smart about what?s on that shelf.?

Nassif also believed the consumer would talk to her. “She’ll tell you what’s good. When you work in retail it’s like being with your underpants down in public, because the customer will either love it or not like it and she votes very quickly. So you?ll learn if it’s a good idea or if it stinks, and you can’t be afraid of that.”

Nassif began hiring people, including a freelance chemist. (Today, she operates her own lab with five chemists.) She set up sales, manufacturing and management, working hard to stay on track.

“We had these binders with very specific tasks,” she explains. “A lot of the early, dark days are days where you keep going down alleys and hit brick walls. You might be missing a piece of information, so we had a task list for all of us to follow.”

Nassif executed the business with little money; she couldn’t even afford desks.

“Anyone who said, ‘I’ll bring my own desk,’ I knew they would work out. Anyone who looked at me and went, ‘Bring my own desk?’ I thought, this is going to last one day. You could just tell right away that people were either energetically embracing the concept or they weren’t.”

Nassif put in some money herself and raised funds from angel investors, but raising money was one of the biggest early challenges.

“We were raising money in the high-tech days, competing with techies.com, and let’s not forget they were all geniuses,” she says wryly. “I’m picking on them, but the only folks with money back then were folks like pet.com, selling dog food across the country. I remember thinking to myself, “Did anyone check the shipping price on a 25-pound bag of dog food?” We were competing against a whole new bubble, and a tangible product was highly unattractive.”

Yet Nassif found investors who understood her concept. Maggie Hughes, a consultant who works with small businesses, was one of the first people Nassif approached for money. A mutual friend got them together.