Growth Newsletter #211

7 tactics AG1 uses to justify its price tag ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­  [Demand Curve]( [Read on demandcurve.com]( The Growth Newsletter #211 8 tactics AG1 uses to justify its price tag I didn't intend to write this. I started with a simple positioning lesson.  Instead, I ended up dissecting Athletic Greens's marketing tactics to turn a commodity product into a near-luxury good.  Let's dive in 🍵  – Neal Brought to you by [Salesforge](—an AI-powered outreach tool that books more meetings by sending personalized emails at scale.  Forget about email templates.  They don't work. People can tell it's a template.  Instead, programmatically send unique emails at scale in any language And don't worry about email warm-up, email list validation, or managing the replies from multiple mailboxes.  Let Salesforge take care of everything in one place.  Double your reply rates and stay out of spam.  Use the code “ILOVEDEMANDCURVE” for 50% off your first month! [Start your FREE 7 day trial]( Want to be featured in front of over 101,000 founders and marketers? [Learn more here](.  8 tactics AG1 uses to justify its price tag Insight by us.  Multivitamins have been on the market since 1916.  Greens powders the early 90s. They are the definition of [vitamin pain](.  So they require a ton of fancy marketing to get you to buy them.  Athletic Greens is easily one of the top players in the market, with $112M in funding and a unicorn status valuation.  And it just so happens to be extraordinarily expensive compared to all its direct and indirect competitors—$80 per month.  In comparison, I got a greens powder from Costco for $40 with 100 days' worth of servings. This calculates out to be 6.67 times cheaper than AG1. A multivitamin from Centrum would be even cheaper still.  Athletic Greens is expensive—no doubt about it.  Therefore, their entire job as a marketing department is to convince you that their premium-priced product is worth paying for.  Consider this an analysis of how AG1 attempts to justify its price tag.  First, the vast majority of companies pitch multivitamins and greens power with (honestly, I just checked like ten brands):  - 40+ vitamins & minerals that are essential for health & normal bodily function - Provide a safeguard to your diet. - Great way to ensure you get enough of the right vitamins and minerals daily. - Specially formulated for various niche groups (women, men, over 50, kids, etc) - High-quality ingredients.  Or, to put it shortly: - SNORE - SNORE - SNORE - Okay, I’m interested. Niche targeting is powerful. - SNORE  If you read our newsletter earlier this week, you'll notice they all appeal to reason, not interest—[read the previous edition]( to find out why that's a bad idea.  Let's dive into eight clever tactics AG1 uses to justify its price:  High price justification #1: We replace a bunch of stuff Here’s why this is smart: - It leverages a famous saying from the movie jaws (”You're going to need a bigger boat”) - It tells you what Athletic Greens replaces—an entire cupboard full of vitamins.  They aim to make people confident they can replace all the other vitamins they’re slamming back each day with one healthier and tasty drink. The claim is: "You'll save money, and it works better than what you currently use."  Hence, this prominent part of their homepage: High-price justification #2: It's totally different. We swear.  If you go to their website, you'll notice they do not call themselves a greenspowder or a multivitamin.  Of course not.  That'd put them in direct competition with cheaper alternatives.  Instead, they're a Foundational Nutrition supplement. What is that you ask? Well, no one quite knows  But it sounds fancy.  Maybe AG1 is worth over six times more than a regular old greenspowder.  Right? This is a concept from the field of category design. Where you come up with some fancy new term for your product to help allow it to operate in a "category of its own."  High-price justification #3: Specific outcomes  As I said initially, their competitors almost all say the same boring things about general health and wellness.  Instead, AG1 focuses on specific outcomes that people care about most (even if the statements are not evaluated by the FDA): Better yet when they're backed up with scientific research: High-price justification #4: The highest quality possible  This is an age-old tactic. Particularly for something attached to someone's: - Health - Wealth - Status How can you make sure that yours appears like it's the best?  For health, make it appear like no one else is remotely close in terms of quality: High-price justification #6: Trusted influencers  Their number one key to success is their influencer marketing.  The hashtag #athleticgreens has over 86.8 million views on TikTok.  Athletic Greens has recruited nearly all the top tech and health influencers to promote and recommend their product.  Not only do they pay for placements, but they also give them a cut of sales.  If you hang on to Huberman's every word, would you not be convinced that AG1 is worth the money? High-price justification #7: Good ol' social proof  We're herd animals. We do what others do.  Therefore, they can build tons of trust simply by highlighting the nearly 50,000 verified 5-star reviews that they've done a great job collecting.  If you're putting something in your body every single day, are you going to trust the greens powder on the shelf at Walmart, or the one with 50,000 glowing reviews? High-price justification #8: Pricing + quality hacks  Our brains are easily tricked.  If something is in a premium package, we value it more.  And if we get a bundle of things for free upfront with your monthly subscription, we feel we got a deal.  That's why their Welcome Kit is genius. You get a premium, branded glass bottle, and tin to use with your Foundational Nutrition supplement—and to signal to everyone else that you're an AG1 user. Is AG1 worth the money? I have no idea.  I'm not a doctor or nutritionist, nor do I make greens powders.  It could be. But I suspect it's all just clever marketing designed to turn a commodity product into a luxury good worthy of the elevated price tag.  Coincidentally, Bryan Johnson posted this [AG1 hit piece]( as I wrote this newsletter. If you're interested, I suggest you check it out What did you think of today's newsletter? 😍 Loved it: Forward to a friend, or reply—a simple 😍 will do! It really helps. 🤷‍♀️ Meh: You can unsubscribe [here](), or manage your subscription [here](. 🤔 I'm new here: You can join the party [here](. 🤩 Give me more: Check out all previous growth tactics in our [Growth Vault](. Something fun  I wouldn’t even be mad. [From Reddit](. How we can help you grow - Read our free [playbooks](,[ articles](, [growth guide](, and [teardowns](—we break down the strategies & tactics used by fast-growing startups. - Need help running ads? We’ve built [the]([ ads agency]( for startups. - Looking for a growth freelancer or agency? [We’ll match you]( with a vetted partner for free. - Get in front of 101,000+ founders by [sponsoring]( this newsletter. Thanks, everyone! [Neal]( [Neal O'Grady]( [Grace]( [Justin Setzer]( [Grace]( [Nick Costelloe](   © 2024 Demand Curve, Inc. All rights reserved. 4460 Redwood Hwy, Suite 16-535, San Rafael, California, United States [Unsubscribe]() from all emails, including the newsletter, or [manage]( subscription preferences.