How to Build Your Resilient Base of Organic Revenue

On the road to the IPO, the most impactful change we made at Chubbies was shifting focus, time, people and resources from A to B. For us, true sustained profit growth and real revenue resilience only came from growing the area under the black line. Those two things, more than revenue growth, were the key components comprising the financial asset value of the brand that made Chubbies so attractive to an acquirer.

For most of the decade it took to go from founding to IPO, we didn't even really know the answers to the following 3 questions

1) What is the black line?
2) How do we track it?
3) How can we systematically grow the area under the black line?


So you can skip straight to building real asset value, here is what I learned about those 3 things, and 3 things you can do today to grow the area under your black line.



1) What is the black line?

The black line is the resilient revenue base. It's the revenue you have when you turn off all your ads, all your discounts, all your promotions and all your new product launches.

Some call this the strength of your brand

Others call it the money machine

Take your pick, but it's the money that's there because of how you've had an impact on the way a bunch of people think about your brand to where they're going to buy from you when they're ready

They'll search for your brand

They'll come directly to your website

This is the compounding enduring value of any brand

This revenue doesn't need convincing. They're convinced


2) How do we track the resilient revenue base?

This shows up as the organic revenue base you have

We generally pull out big pops so we can focus in on the stable, resilient base we've built

Tracking and understanding the unpaid organic revenue machine is as important (or more) than how we've been trained to dig deeply into how we're driving revenue in our short term attribution windows

Visually, in B, you can see the spikes get bigger as the resilient base grows

The best part here is seeing increased efficiency in the of your tactics to drive short term sales

Yes, there is a virtuous cycle


3) How can we systematically grow the area under the black line?

Just focus on it

Important note: to get good at growing your black line, you don't need to turn into brand advertising experts, churning out Apple's "Here's to the Crazy Ones" on the daily.

No one has money for that sh*t


Action to take:

All we have to do is start focusing on the above and remember the following 3 ideas:

1) Our goal is to increase the probability that the brand comes to mind when the buyer goes in-market, NOT to persuade the buyer to go in market.

2) "People use their memories when buying. Simply put, the brand that gets remembered is the brand that gets bought." - John Dawes of the Ehrenberg-Bass Institute

3) Since marketing works by influencing future buyers, do things that get noticed and get remembered. It gives you permission to be bold, put on a show and have a little fun.