The Modern Retail Podcast

This week’s Modern Retail Rundown includes a check-in on Nordstrom, with news of the founding family allegedly looking to take the department store private. We also delve into Unilever's ice cream division -- which includes the Ben & Jerry's and Magnum brands -- which may be spun off into a separate company. Lastly, we discuss reports of Shein pivoting into supply chain services.

AriZona Iced Tea is a ubiquitous product in the U.S., but you didn't learn about it because of a flashy ad campaign.

"We have never had a billboard," proclaimed AriZona Beverage Company's CEO Abid Rizvi. "I will say this with almost 100% confidence: you will never see an AriZona billboard in Times Square."

Instead, the way AriZona has marketed itself is by simply having a presence at the store. AriZona judges its products on three dimensions: does a product look good? Does it taste good? And is it priced fair? According to Rizvi, it's those three guiding principals that have led to AriZona's success.

Rizvi joined this week's Modern Retail Podcast and spoke about the brand's history and its plans for the future.

AriZona first launched in 1992 as a side hustle to co-founder Don Vultaggio's distribution business. Vultaggio formulated some iced tea and, through his distribution contacts, was able to get shelf space in some stores. Things snowballed from there -- with AriZona becoming one of the main competitors to players like Snapple. One revenue estimate puts the iced tea business alone at $2 billion in annual revenue.

But iced tea isn't AriZona's only product. The company has expanded into other areas like fruit snacks and, most recently, hard iced tea. It's these ambitions -- along with international expansions -- that Rizvi, who became chief executive in 2016, oversees.

But even when launching new products or going into different categories, the thesis has remained the same. "What I can tell you is: globally, no matter where you go in the world, people like good-tasting beverages," Rizvi said.

With that focus on product, AriZona has traditionally shied away from expensive marketing gimmicks. Instead, according to Rizvi, the company's most important goal is making a product that tastes good and unique -- as well as has a unique branding that catches people's eyes in stores.

"People are not buying any particular brand because they saw a Super Bowl ad," Rizvi said.

On this episode of the Modern Retail Rundown, the editorial staff breaks down the retail industry’s biggest stories. This week things kicked off with NRF's Big Show, covering themes like AI, inventory management and the American consumer's mindset. Meanwhile, Kristen Bell and Dax Shepherd's baby brand Hello Bello is set to be revived by its new owner, after the brand named a new CEO this week. Finally, a look at the much-needed holiday sales growth retailers saw in December, as indicated by new numbers released by the Commerce Department.

On this week's Modern Retail Rundown: Ulta's latest performance shows that beauty sales may finally be decelerating. Retailers like Express, Peloton and Saks have reportedly been late on paying their vendors -- indicating cash flow issues. Finally, there was drama in the food startup space as Momofuku gets litigious with competitors.

Home goods brand Coyuchi has been around for 30 years and has seen the industry transform.

Its core focus is on providing organic cotton products. It's perhaps most well known for its bedsheets, but has expanded into other areas like loungewear and napkins. But the focus has always been to grow keeping its promise of organic products that speak to its target consumer in mind -- which it considers its competitive advantage against the ever-growing DTC home goods space.

CEO Eileen Mockus joined this week's Modern Retail Podcast and spoke about Coyuchi's growth and strategy. The company first launched before DTC was a buzzword -- and as such grew via wholesale. "It was a lot of small retailers," she said. But over the years, the company invested more and more online -- and its e-commerce presence is now its largest sales channel.

"It's a big shift," Mockus said.

Mockus said that one of the ways Coyuchi was able to grow its online presence so much was by establishing its brand via these retail partners. Through that, the company was able to let customers know about its focus on sustainability.

The marketing behind its organic focus has also shifted. Sustainability-focused marketing a decade ago, she said, was "almost a scare tactic." That is, telling a customer about all the perils of using non-organic products. But now, the brand has realized it's better to use this focus as a way to explain why the product is enhanced. "We were really able to shift the conversation," she said.

But Coyuchi isn't the only brand having such a conversation. Search for DTC bedding on Google, and you'll be presented with dozens of different options. But Mockus said that Coyuchi being an early arrival -- as well as its focus away from the target millennial demographic most DTC brands go after -- has helped it stand out.

"It has definitely been a crowded space in the bedding market," she said. "We have always had a view to who our customer was."