Liquid Death CEO on marketing: We're day trading attention

Canned water company Liquid Death has become a rising brand in internet circles and music scenes, particularly for its trendy tallboy packaging. Liquid Death Founder and CEO Mike Cessario managed to give water a whole new look, leveraging the popular aesthetic to expand Liquid Death's catalog to now include cans of lemonade and iced tea.

Cessario joins Yahoo Finance Live anchor Josh Lipton and reporter Brooke DiPalma to talk about Liquid Death's marketing and its partnership with concert promoter Live Nation (LYV)

"All the fun marketing for most food and beverage brands are for unhealthy things. anything that's funny or exciting is typically for candy, junk food, fast food, beer. So we're trying to make a healthy brand that markets in the same funny and fun way as... unhealthy brands," Cessario explains. "We're even starting to source occasions from the beer side of things because this is more of a replacement for beer or soda in people's routine..."

Cessario also touches on whether a TikTok ban in the US will put a drag on Liquid Death's online exposure and the brand's general pricing in the food category.

For more expert insight and the latest market action, click here to watch this full episode of Yahoo Finance Live.

Editor's note: This article was written by Luke Carberry Mogan.

Video transcript

[AUDIO LOGO]

JOSH LIPTON: Liquid Death, one of the fastest growing names in non-alcoholic brands has closed more than $60 million in funding, putting its valuation more than $1 billion. The company made a splash on the beverage scene just a few years ago with its canned water that promised to murder your thirst. Liquid Death has since expanded to sparkling water and iced tea offerings. And a new lineup of big name investors could bring new opportunities in the year ahead.

I'm joined now by Liquid Death's founder and CEO Mike Cessario and, of course, Yahoo Finance's very own Brooke DiPalma. Mike, it is good to have you on the show.

So you closed $67 million in financing, Mike. What do you plan to do with that money? How are you going to put it to work to now build and grow this business?

MIKE CESSARIO: Yeah, like you guys mentioned, we started off as just mountain spring water in a can and eventually launched sparkling. And then we launched flavored sparkling, which actually has a few grams of sugar from agave so it's kind of more like a healthy soda. And then we launched Liquid Death iced tea last year, which has been really successful.

So I mean, we've really kind of proven that we're building a true cross category healthy beverage brand. And you know, now that we've, sort of, dipped our toe in some of these categories where with flavored sparkling, we started with just three flavors, iced tea, we started with three flavors. And now we're starting to really add more innovation and flavors into these categories that are starting to work.

BROOKE DIPALMA: Hi, Mike. It's Brooke here. Live Nation is a long time investor in the company. They played in this recent round. How has this partnership helped the growth story of Liquid Death?

MIKE CESSARIO: Yeah, I think a big part of what our brand is all the fun marketing for most food and beverage brands are for unhealthy things. Anything that's funny or exciting, it typically is for candy, junk food, fast food, beer. So we're trying to make a healthy brand that markets in the same funny and fun way as unhealthy brands. And we're even starting to source occasions from the beer side of things because this is more of a replacement for beer or a soda in a lot of people's routines. And whether that is being at a music festival, or a bar, or a venue where you don't typically want to walk around with a glass of water, Liquid Death, kind of, creates a new experience to drink something healthy, but it's actually fun to walk around with.

JOSH LIPTON: And some of your investors here Mike, I mean, it is an eclectic impressive group. So I'm seeing DeAndre Hopkins, got the comedian Jim Jefferies, fantastic. Josh Brolin, we all loved him in "Sicario," I know. I'm interested, Mike, how do you actually decide which investors get to invest? I mean do you meet like a Josh Brolin and decide, listen, he just gets this company, where we are, and where we're headed?

MIKE CESSARIO: Yeah, you're pretty spot on there. I mean, we've had the luxury of being able to be selective about the investors that we bring into the company. And we really are focused on people who truly love the brand, understand what we're doing. And all these folks, I mean, they come sort of inbound to us where we find, hey, they're a huge fan of the brand. And then if there's an opportunity to invest, we can find a way to get them in.

BROOKE DIPALMA: My TikTok has played such a large role in the growth story of Liquid Death. Of course, there's a potential ban happening here in the US. What sort of impact would this ban of TikTok here in the US have on the company?

MIKE CESSARIO: Well, we like to say at Liquid Death that the way we think about marketing is we are day traders of attention. We try to find where is people's attention at, what is the most cost efficient way to go get that attention. There's TV commercials. You can reach a lot of people, but what you're paying per eyeball is really high to get your message to them.

Whereas, social platforms and emerging platforms, there's a lot of attention there. The per eyeball cost is a lot lower. So TikTok just happened to be a place where there's a lot of attention. And when we have our entertainment comedy-first approach to marketing, we're not here to make ads. We're here to make actual entertainment that makes people laugh.

We can go into any platform where people's attention is and they're into what we're doing. They want to follow us because we're providing value. So even if TikTok goes away, whatever the next platform is where people shift their attention, we'll go there and gain followers by continuing to entertain people.

JOSH LIPTON: And Mike, you know your company now is valued here at more than $1 billion. What about going public, Mike? Is an IPO a possibility? And if so, what are some of the factors, the variables that depends on?

MIKE CESSARIO: Yeah, I mean we're really just focused on building a large, profitable business. And we know that if we stay on that course, that we will have optionality for any outcome that we want, whether that is an IPO or whether that's a strategic partnership. So we're, of course, going to do everything that we have to do to preserve optionality. And if an IPO sometime in the future is something we want to do, we've got to go through all the steps to make sure that that's even an option. So that's really how we think about it.

BROOKE DIPALMA: Mike, grocery prices have been steadily increasing over the past few years. Some may say that this is overpriced for water, what do you say to that?

MIKE CESSARIO: I mean, we're right at the same price point as most other premium waters and are just plain water skew. So Fiji, Essentia, you know, Pellegrino, all of that, we're right around the same price as all of those brands when it comes to premium water. And then in flavored sparkling and healthy soda, we're not actually priced that much more above where other premium brands in our respective categories lie.

JOSH LIPTON: Mike, thanks so much for joining the show today. Appreciate it. Of course, our thanks to our very own Brooke DiPalma as well.