Case Study: Art Brand Firm

Growing After a PE Acquisition

A private equity firm that specializes in investing in small businesses across the United States, acquired Art Brand Company, a company that publishes and licenses art.

The manageing partner and his team saw a potential for growth, but also faced some tough challenges. “We had three distinct brands in different phases of their lifecycle,” said the Vice President of Sales and Marketing. “We needed an expert executive to help us craft our marketing strategies.”

Expertise in Branding and Strategy

The managing partner reached out to Afra Sanjari, and immediatelty recognized Afra is a seasoned Marketing Strategist, who can lead the charge.

“When we brought Afra on board, we had just acquired a nature art company in the Midwest,” the managing partner explained. “The main goals that we asked Afra to work on were branding and increasing direct-to-consumer sales.”

Afra assessed the situation and found that “This art company, worth $25 million, was depending on beloved but outdated brands. They had an opportunity to grow, but they lacked the insights, strategy, and teamwork to seize it. They were putting in a lot of effort, but without a clear direction, different departments were using data inconsistently and pursuing conflicting strategies.”

Data-Driven Growth Strategy

Afra met with the Managing Partner and the VP of Sales and Marketing three times virtually to devise a growth strategy. He soon realized the need for faster reporting and more data clarity. So, he worked on creating trustworthy data on finance, operations, sales, and profitability.

Afra also found out this company's poor data visibility and integration across the company made it hard to measure ROI for each marketing activity. It was also unclear how the different tactics complemented each other to achieve the best media mix.

“They have a great team and products and leverage,” Afra said. “But the different products and channels were operating in silos, they were not creating synergies across their units and not taking advantage of an omni-channel approach.”

More Insights Gained:

Digital ROAS was 5 to 9 times higher than catalog. IT analysis revealed surprisingly low customer lifetime value. Website conversion on some items was below 1%. Artist engagement tactics boosted consumer loyalty. Afra also discovered that their catalog business was not using omni-channel media. In general, they invested too little in digital marketing.

Despite the challenges, the collaboration was successful for their leaders. “Afra was both strategic and hands-on,” the Managing Partner said.

Brand Strategy Initiatives

To solve the data problems, Afra introduced a CRM system and a data aggregation tool. She also launched strategies to rebrand and leverage the key aspects of the main brand, grow an existing brand and create a new brand, the Art of Entertainment.

Key Initiatives – Revenue

A rebrand, SKU Optimization and Price Hike.

Afra also used new trends to increase revenues, by developing products in more categories.

Organization and Operation Improvements

To simplify the organization, Afra set up a product management structure with dedicated brand managers and shared support services. The organizational change enabled centralized strategies and clear roles and responsibilities.

To enhance performance, he applied a RACI (Responsibility, Accountability, Consult, Inform) project responsibility process. Other important organizational initiatives involved implementing easy to access, omni-channel integrated data, shared reports and increased cross department transparency

To improve marketing ROI, he also suggested that they outsource some support services and automate some marketing activities. Distribution initiatives involved developing channel support, affiliate and Amazon programs. Moreover, cost reduction initiatives focused on allocation changes, margin management and freight.

D2C Revenue Boosted by 49%

Afra Sanjari worked closely with the VP of Marketing and enhanced collaboration, confidence, and decision-making across the company. As a result, they grew 9% in 2020 despite the pandemic and is ready for substantial three-year growth.

Industry retail sales dropped in 2020 and they were not spared. With key retail channels shut, wholesale revenue fell 33%. However, their pivots led to a 49% increase in its direct-to-consumer business and an overall positive 2020 compared to the previous year.

“He gave us the framework to handle multiple brands and to grow and diversify our marketing efforts,” the Managing Partner said. “The benefit of having someone like Afra who can act as an impartial resource is to really help us to be agile with change and ideas.”

Better Organizational Efficiency

Sanjari’s efforts affected both marketing and operations. “Afra improved organizational efficiency by enhancing cross departmental communications,” the VP of Sales and Marketing said. “And that greatly improved the product development cycle and manufacturing productivity.”

One of Afra's first achievements at this art brand company was the creation of a new brand.. “He encouraged us to be more innovative and gave us a lot of suggestions about how to better connect with a new target audience,” the Managing Partner said.

A Perfect Solution for PE Growth

For a PE-backed CEO, a fractional CMO, specifically Afra Sanjari, was the key to growth. “I would recommend Afra as a Fractional CMO to any business owner who’s looking for insight on a sales and marketing growth strategy,” the Managing Partner said.

“It’s a great set up because you get talent, experience, and insight that you couldn’t afford to hire on a full-time basis. He really helped define what we needed to do here to sustain the growth of the company.”