How Nerds Candy Went From $50M To $500M

In episode #2865, Nerds has proven that one product innovation can completely transform a brand. Eric Siu and Neil Patel break down how Nerds, and even Stanley Cups, became powerhouses by pivoting their strategies—and what you can learn to apply to your own business. Don’t forget to help us grow by subscribing and liking on YouTube! Check out more of Eric’s content (Leveling UP YT) and Neil’s videos (Neil Patel YT) TIME-STAMPED SHOW NOTES: (00:00) The Rise of Nerds Gummy Clusters (02:11) Transformative Marketing Strategies in Consumer Products (04:37) That’s it for today! Don’t forget to rate, review, and subscribe! Go to https://www.marketingschool.io to learn more! Leave Some Feedback: What should we talk about next? Did you enjoy this episode? If so, please leave a short review. Connect with Us: Single Grain << Eric’s ad agency NP Digital << Neil’s ad agency X @neilpatel X @ericosiu

• 0:00Speaker 00

  Finding customer information shouldn't mean digging through emails, call notes, and spreadsheets. HubSpot's Starter Plan brings all of those details together, so it's easier to track what's happening with every deal and what to do next. It pulls information from calls and emails. Then it gets to work, logging and summarizing them. Right after your call ends, HubSpot pulls next steps from your call notes and drafts suggested follow-ups. And it stays up to date for you, so you can build demand, win more deals, and spend less time on repetitive work. Your records, insights, and next steps are ready for you to act on, and you don't have to miss a beat searching for any of it. Try the Starter Plan for $10 a month. Learn more at hubspot.com. So, did you know Nerds had about $50 million in sales about six years ago? This year, Nerds gummy clusters alone has generated more than $500 million.

• 0:57Speaker 00

  You remember Nerds? You used to eat Nerds?

• 0:59Speaker 01

  Uh, I didn't really eat them much as a kid. Their food coloring, you see some of it's made out of like insects and stuff, right?

• 1:05Speaker 00

  Is it?

• 1:06Speaker 01

  Yeah, you didn't know that? I should send you the YouTube, Instagram.

• 1:08Speaker 00

  Well, I never ate them. I don't know why people ate them. I thought they were disgusting, right? But, there's a Wall Street Journal post here called "America's newest hit candy is gummy, crunchy, and printing money." The growing popularity of Nerds gummy clusters is an improbable outcome for a brand that has existed for more than four decades has become such an afterthought, right? So, basically, um, it was acquired in 2018, and then, um...

• 1:30Speaker 01

  Wait, they acquired the gummy cluster company?

• 1:31Speaker 00

  No, so they, the gummy cluster was an idea, I think, um, so let me just read this over here. So, "When the brand was acquired in 2018, the entire Nerds line has roughly $40 million in sales. In the hopes of revitalizing a stale brand from the 1980s, the privately-held candy conglomerate knew it needed to develop a new product. Nerds got their glow up with the 2020 release of a bean-shaped, gummy-coated, and technicolor, irregularly-shaped pebbles, right? The following year, Nerds gummy clusters were responsible for nearly $100 million in sales, according to the company. This year's sales have crossed $500 million even before Halloween. This one new product now generates 90% of Nerds' overall revenue, and it rivals Starburst, Sour Patch Kids, and even Skittles."

• 2:09Speaker 01

  They should sell the company.

• 2:10Speaker 00

  They should, yeah. Whoever bought it should sell it again. It was probably private equity that bought it. They're probably gearing up to sell it again.

• 2:16Speaker 01

  Yeah.

• 2:16Speaker 00

  Alright, so I wanted to take a second to tell you about the Agency Owners Association. So this is a agency peer group ran by my podcast co-host Neil Patel and myself, Eric Su. And these were nine and eight-figure agency owners respectively. And what I will say is, at the end of the day, you want to learn from people that have been there, done that. If you want to grow your agency to seven figures, eight figures, and beyond, this is the group for you. And we bring in other agency owners to speak as well. And it's a great peer group where you can help each other out. And you're going to learn how to acquire more clients, you're going to learn how to take yourself out of the day-to-day, and to build the business of your dreams. And the cool thing, till November 30th, we are holding a special price, and you can apply at marketingschool.io/agency. And the great thing about it as well, if you try to get into a group, there's a seven-day free trial, right?

• 2:58Speaker 00

  So, once November 30th hits, we're going to increase the price by $200 per month. So right now, you're getting it at the lowest price possible. So go to marketingschool.io/agency to learn more, and we'll see you inside. Isn't that impressive, though? Just, sometimes you just need to figure out one new product, and it changes the entire company.

• 3:14Speaker 01

  It's like the Stanley Cup.

• 3:16Speaker 00

  Yeah.

• 3:16Speaker 02

  The reusable water bottles are one of the most sought-after forms of beverage containment. Largely thanks to TikTok, Stanley's revenue jumped from $74 million in 2019 to $750 million in 2023.

• 3:31Speaker 00

  Oh my god, they do what, 100 million a year?

• 3:33Speaker 01

  More. The reason Stanley Cup blew up was, they were, before, they were like, "Yeah, we're going to target construction workers." And then, some blogger or influencer was like, "Hey, can I get these cups in a pastel color, I want to do a campaign?" They ended up doing it, and they realized it started taking off with moms, and then they just leaned into it. They're like, "Huh, this makes us way more money than trying to sell these cups to, like, construction workers."

• 3:54Speaker 00

  Yeah. And they do, I mean, I have, I have like the Yeti ones, I just buy Yeti stuff. Um, so, and I think Yeti does over 100 million a year, too. So, yeah, I don't know, I mean, like, so this guy over here, this, he led the team that created Nerds. Um, and then this cluster thing over here, so that's what these clusters look like. Um, maybe I'll do it over here, you guys see the clusters?

• 4:13Speaker 01

  Oh, there's more than one flavor.

• 4:14Speaker 00

  Yeah. And, uh, Nerds gummy clusters creators shrink the size of the hard-shell nerd candy to best coat the gummy middle, right? Um, so anyway, all that to say is, same with Stanley Cup, the Stanley Cups, right? Like, that was a new product line.

• 4:29Speaker 01

  In the same product line?

• 4:30Speaker 00

  But better marketing.

• 4:31Speaker 01

  Uh, different marketing. They just changed the colors of the cups and they started targeting women.

• 4:36Speaker 00

  Yep. Well, anyway, sugar sales, you would think that sugar candy sales would be down, but they're actually up. Do you know by how much since 2020?

• 4:44Speaker 01

  Uh, it must be a lot because sugar's addicting.

• 4:47Speaker 00

  Yeah, so what percent do you think it's up?

• 4:49Speaker 01

  Per year or in total?

• 4:50Speaker 00

  Total, since 2020.

• 4:52Speaker 01

  I'll give it 40%.

• 4:53Speaker 00

  74%.

• 4:54Speaker 01

  Wow.

• 4:55Speaker 00

  Yeah. So, oh yeah. Um, look, this is a nice article. Just go read it on Wall Street Journal, but I just think it's amazing. You can 10x this thing, um, and just by sticking with it because nerds have been around for so long. Sometimes you need someone to come in and revitalize the company and that's what happened, so.

• 5:10Speaker 01

  Yep.

• 5:11Speaker 00

  That is it for today. Uh, again, from Frankfurt, Germany, this is Marketing School and don't forget to rate, review, subscribe and go to marketingschool.io/agency if you want to join the Agency Owners Association. And we'll see you tomorrow.