The SkinnyPop Fallacy and Why it Matters

SkinnyPop’s ultra-fast exponential growth ride is by now quite famous. A crack CPG sales team led the charge up the ramp. Velocities grew organically as the accounts turned on and on. 

But one of the problems that Amplify Snacks inherited was that the growth decelerated fast during the brief IPO phase, right above $100M in trailing sales. 

Why the deceleration? Well, it wasn’t because they had reached too many households.

Instead, the primary reason was that the brand didn’t get built as much out of the store as in the store. Yes, there was terrific word-of-mouth based on the product experience alone. But this is often NOT enough to sustain growth once you hit the nine-figure.

Instead, the brands that I see who grow continually in the double-digits to $500M or beyond, especially in oversupplied categories like food, in most cases were building ground-level enthusiasm with consumers from the very beginning. 

They didn’t scale the brand, see velocities decline and then decide to focus on the consumer.

Facepalm. 

Overlooking consumer interaction is a unique problem for experienced, sales-only teams with an admittedly perfectly timed product design. But it’s just a big version of what might happen to most founders when they hit $20M or so and see the same problem in their topline numbers.