The Marketing Strategy Behind Yeti’s $3.9B Valuation

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Good morning! It's Tuesday, August 22nd- Today we’re covering how Yeti was able to grow to a $3.9B valuation despite selling coolers priced 10X higher than the competition.

THE FEATURE

The Marketing Strategy Behind Yeti’s $3.9B Valuation

When Yeti got its start in 2006, most people suspected a company selling $300 coolers was bound to fail in a market filled with coolers as cheap as $40.

Today, Yeti has clearly proven its critics wrong and has an enterprise value of $3.9B.

So, let’s figure out how Yeti found success by upselling the cooler industry.

So, What’s the Business?

Brothers Ryan and Roy Seiders grew up in Austin, Texas with a serious passion for fishing. They first tried to monetize this passion by creating custom fishing rods, but the startup ultimately failed.

However, the Seider brothers struck on their multi-billion-dollar idea while on a fishing trip in Mexico. During the trip, their coolers continued to break when stood upon to cast their rods. They realized that there was a massive hole in the cooler market for high-end products that could withstand the abuse of outdoorsmen.

While a $300 cooler may sound crazy to you, Ryan and Roy had an in-depth understanding of what outdoorsmen desired and what they were willing to spend for top-of-the-line gear.

Rather than looking for partnerships with one of the big retailers, the brothers' original strategy was to exclusively sell out of local mom-and-pop tackle shops and sporting goods stores. Once again, this decision was based on their extensive experience as fishermen and knowledge that their peers frequented these mom-and-pop stores to purchase top-quality gear.

This grassroots strategy worked because they were selling what truly was, and is to this day, the best cooler on the market. As such, those that purchased Yeti coolers became evangelists for the brand, which proved extremely effective since many were professional fishermen and outdoor guides.

Yeti still focuses most of its marketing material towards outdoorsmen, but they have since diversified their product offerings substantially, selling everything from water bottles to cast iron skillets.

Across all its products, Yeti generated $1.95B in revenue over the last 12 months.

How They Win: Masters of Branding

Selling the Dream

Not too many people go fishing enough to warrant dropping hundreds of dollars on a cooler, but that doesn’t mean that they won’t do it.

Amateur gear junkies spend thousands of dollars on the latest sonar, GPS gadgets, and fishing rods to feel like professional fishermen.

So, by branding Yeti coolers as another professional fishing essential and recruiting brand ambassadors, like legendary angling legend Flip Pallot, Yeti has mass market appeal to all fishing enthusiasts.

Content Marketing

Yeti’s content manager Harrison Lindsey always cringes when he sees branded content that starts with a great story and then ends with a direct plug for the advertised product.

Yeti has acquired 1.9M followers on Instagram, 550K on TikTok, and 150K on YouTube by producing content that focuses on the story first and product second.

With high-quality productions for short documentaries like “The Ballad of Pecos Hank” and “A Thousand Casts”, Yeti solidifies its connection with its community of hardcore outdoorsmen and sets itself apart from the average retail competition.