If you want to find out when you should consider bringing a big influencer on board and how you should approach a partnership negotiation, tune in to this episode of The Influencer Marketing Blueprint.
In this conversation we're joined by Jason Panzer (@JasonPanzer), President of cookware brand HexClad, to discuss what it takes to get a top-tier celebrity as the face of your brand and the ways it can impact the growth of your business. We discuss the ins and outs of how HexClad secured a partnership with Chef Gordon Ramsay and how it transformed the brand.
First, a little dose of reality: the level of celebrity endorsement HexClad has achieved with figures like Gordon Ramsay, Hailey Bieber, and Oprah is not commonplace for many brands. These partnerships place HexClad at the pinnacle of brand endorsements, a testament to the scale and prestige they've attained. While aspiring to this level of success is ambitious, it's not a feasible strategy for every brand. And, more importantly, it's not the only way to scale (we talk more about what you should be focusing on based on your revenue here), and aiming for such high-profile flag bearers might not be the most advisable path. However, for brands that have reached this point, the insights shared here will be invaluable.
When to Consider a Flag Bearer
Having a celebrity or big influencer (i.e flag bearers) on board has the potential to elevate your brand and grow your business. But not every company is ready to take this step.
So when should you entertain bringing on a big influencer?
It should start from a solid position. Not only does your business need to be at a growth stage where you don’t really need a celebrity to turn a profit, but it must also have established a well-built brand with a solid vision. Starting with a great product is essential, too; it needs to be a standout product that’s differentiated via true value that benefits the end user.
“You need to be prepared to make your case and a lot of evidence to show them this is going to be a great partnership.”
Once you’re prepared to make your case for working with an influencer, you should be able to show the talent how they can help your product become more valuable and in return, how you can create additional value for them. Beyond the financials, ensuring the influencer connects with your brand is key.
HexClad ventured into influencer marketing in 2022. The goal was to get the brand everywhere. “At that stage, we were big enough to take that mission forward,” Panzer said.
Instead of choosing the “pay-per-post” route, HexClad decided to bet on PR gifting to reach celebrities, influencers, and the press; a strategy that ended up proving successful in raising the overall visibility of the brand.
“People love our product. Gifting has been very successful for our company.”
During this time, they noticed Gordon Ramsay was following HexClad’s Instagram account, which presented a great opportunity. The HexClad team reached out to Ramsay’s people and started conversations around a possible partnership.
At the time, Ramsay didn't have a cookware deal in place. According to Panzer, there was a vision alignment between HexClad and Ramsay from the get-go. “He did not need to do this partnership. He did it because he found what we were doing interesting and valuable.”
The dialogue between HexClad and Ramsay's team quickly transitioned into deeper discussions about HexClad's vision, mission, and ambition to revolutionize cooking. Despite being a mid-sized company with eight-figure revenues at the time, it was their solid financials and clear vision that got the attention of Ramsay's team.
"We weren't a typical VC-backed startup, and we weren't offering equity in anticipation of future funding rounds. Nor could we afford a hefty cash payment for an endorsement deal. Instead, we pitched the value of becoming an investor in HexClad, backed by our solid financial performance and growth potential."
HexClad decided to bring celebrity chef Gordon Ramsay in as an equity partner, and in about six months, they had an equity agreement in place. The key to such a quick agreement was to show Ramsay’s team exactly how much his stake was worth.
“We had a real strong sense of our value,” Panzer said, “So we approached the negotiations in a very straightforward manner: ‘Here’s what this is going to be worth to you if this goes well’.”
When it came to deciding what kind of offer they were willing to put on the table, HexClad decided not to focus on percentages, but on calculating the exact worth of the stake.
“You should be looking at the stake and what it’s worth. It’s not just about getting X percentage of a company.”
Defining the value of the influencer is a challenging part of the negotiation process. “Their value depends highly on what they can bring to the table,” Panzer explained. He went on to say that people are usually too hung up on how much they’re giving. “At the end of the day, if this is the right person for your business, even if you give a little more, it doesn’t really matter.”
Since the start of the partnership with Gordon Ramsay, HexClad has seen a noticeable boost in performance and brand awareness, and Panzer said that comes from the authenticity of the relationship. Finding an influencer that truly likes the product and embraces your brand vision is key to the success of the partnership. An influencer who is willing to go above and beyond will take the brand to another level and will trigger a snowball effect.
“On the performance marketing side, ads do really well for us. And this has a lot to do with the authenticity of our celebrity partnership.”
Panzer gave the example of Gordon Ramsay who dubbed HexClad as the “Rolls Royce of Pans,” which was major for building brand ethos. “Now everyone calls us that,” he said. In the case of Gordon Ramsay, whitelisting ads has been successful in driving up HexClad’s sales, too. “The combination of our value proposition as a product and Gordon’s endorsement has been very successful. It’s been a real win-win for everyone involved,” he said.
- Your brand must be built up before considering bringing in a big influencer; it’s not something to do right out of the gate.
- A successful partnership needs to be authentic. The influencer or celebrity partner must feel excited about and connected to your product.
- Negotiations should be straightforward. You must have a strong sense of your company's value and know what’s fair to make the partnership work for both parties.
HexClad's impressive feat of generating around $400 million in revenue didn't just happen by chance. A critical aspect of their success lies in meticulous financial planning and understanding of unit economics. It's about knowing your costs inside and out— from the cost of goods sold (COGS) to shipping, from factory to warehouse expenses, to transaction costs. Only with a firm grasp on these figures can a brand consider scaling their offers and think about bringing on a celebrity as a flag bearer.
For HexClad, this also meant developing a solid creative strategy and establishing their flywheel before they could even contemplate offering equity to attract such high-caliber endorsements.