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Segment 10: What Informs New Product Ideas At Tower Paddle Boards

Below is an excerpt from our 2019 interview with Stephan Aarstol, the Founder & CEO of Tower Paddle Boards, who continues his conversation with Brad Kauffman of NoMiddleman.com. If you’d like to read or listen to the full interview, visit the Tower Paddle Boards blog post.

 

Brad: Great. What informs your ideas for new products? It sounds like with the paddle boards, it was just … a new product that you experienced, that you just did not see out there. Is that what drives your new products? Or is there some type of suggestion-monitoring, or anything like that?

Stephan: That’s a great question. How do we come up with ideas for new products, or decide which product classes we’re going to go into?

I founded the company because I live in Southern California. I live right on the bay and I had a buddy that took me paddleboarding. So I’ve kind of lived this beach lifestyle. I’ve always lived a few blocks from the water. When I was 18 years old I moved to Hawaii. I’ve always kind of been in these beach communities and lived this beach lifestyle, and it’s something I know, right? It’s something I see every day. So I have intimate knowledge of this.

While I wasn’t like a competition paddleboarder, it was something that I tried and was interested in. And when we launched the paddle boardcompany, I was looking at this from a business perspective. It wasn’t like, “Hey, I’m a huge paddle board fan and this is the type of business I want to start.” A lot of our competition was like that, and they were unsophisticated. They were just surfers running a surf company.

We took a hardcore business look at this and said, “This is a great market.” We understand this product and we live this day to day, but we’re not just paddleboarders who are selling you a paddle board, we’re attacking this from a business perspective.

A lot of people were in electric bikes and bikes and skateboards. People are like, “Wow. This doesn’t make any sense. How did you get from paddle boards to that?” Really what we’re doing is, we’re going after products that we use in our daily lives, that people in our beach community see. If we’re literally standing on the beach next to a lifeguard tower and we close our eyes, everything we can hear, everything we can smell, everything we can see, that’s beach lifestyle.

Brad: Got it.

Stephan: Those are the products. We think that that really fits our brand, because people can really resonate. The same people that are using a longboard skateboard down the boardwalk, the next day they’ll be riding a beach cruiser.

Our electric bikes are not electric mountain bikes. They’re electric beach cruisers because that is what our world is about. So we know these products better than anybody. We know what the problems are in the beach cruiser market. We know what crappy products are like, and we know how to make good products. If a company out of New York is creating beach lifestyle products, they really don’t understand the market as well as we do. That’s how our brand has this authenticity, because we’re making products that we know. We do surfboards and we have a lot of people at our company that basically shape surfboards. We have a surfboard shaping room in our retail store, in the current retail store.

Brad: Okay. Cool. So you’re essentially taking an adjacent product that makes sense and figuring out, what’s the new trend with this? Or what’s the piece of this we can do better?

Stephan: Yeah, and some of it is we’re filling in holes. We’re a paddle board company, so we started selling surfboards as well. The surfboard market, to be perfectly honest, isn’t a great market. But we said, “Hey, we’re a Southern California beach company, we should offer surfboards.” We can offer surfboards for basically half the price (compared to) what people are paying in other stores around here. We can have a nice little local business like that.

Same thing with the beach cruisers. We realized we’re not going to sell a ton of these beach cruisers online, because we sell a $500 beach cruiser, when anybody can go buy a beach cruiser in our town for a 150 bucks. And they’re cheap pieces of junk and they’re basically disposable. But we made what was the equivalent of a high-end bike in a beach cruiser. It’s got a belt drive, it’s in aluminum, it’s got all of the highest components. It’s how you would build a high-end mountain bike. And so we have the world’s finest beach cruiser.

We knew there wasn’t going to be a huge market online for that, but in our local community, we realized we’re going to be able to sell a lot of these, and when people get this product they’re going to see that this is beyond any beach cruiser out there.

That really supports our brand. We’re not just like this discounter. We’re able to sell you stuff at half price, but that can be the best beach cruiser in the world, or it can be the best price on a beach cruiser. So we go after products that we think make sense for our brand, like skateboards. We wanted to have a skateboard. We didn’t think that was a particularly huge market, but we actually sell quite a bit of those online. We’re doing really well with those.

And then we also look at, okay, what are the next trending sports or trending products? That’s what paddle boards were, that’s what poker chips were. It’s easier to grow a brand when the industry is growing 50 percent a year.

We’ve been in e-bikes, that’s what we really feel is this massively growing market. People really don’t understand e-bikes in the US yet. A lot of people haven’t ridden them. The first time you ride an e-bike, you’re going to be like, “This is life changing.” Right now people go ride a bike, they really don’t want to go into hills, so they avoid hills. They’re not going to go 10 or 20 miles from their house because they just don’t. They don’t want to pedal that far. You get on an e-bike, all of a sudden you can have a 20 mile bike ride in the afternoon with basically zero effort expended, or as much effort as you want. You can get some exercise, and you can explore hills. You can go into areas that you’ve never been before.

I mean, once people ride it, they get it. They say, “Holy cow. This is awesome.” That “aha” moment hasn’t happened in the US, and I think this is a growing market and I think we’re fairly early into it, and we think once people realize the quality of product that we’re giving them, and just the idea of how cool an e-bike is, that market is going to explode.

It’s the same thing that happened with paddleboarding. When people first went out paddleboarding… they were like, “This is life-changing. This is really fun. It’s helping me get in shape. I’m getting a sun tan. I’m out here with my friends.” People are like, “God, I should do more of this. I should spend more of my life doing stuff like this.”


Next: What Tower Paddle Boards Is About (From A Value Standpoint)

Tower Paddle Boards went in two unique directions, when it comes to delivering value. Product development is focused on what the consumer needs (not what it costs), and team productivity is fueled by Aarstol’s revolutionary idea to live more by working less—with a five-hour workday. Learn the secrets behind Tower’s popular products and productive culture. Read more >>


 

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Full Interview: Tower Paddle Boards

If you’d like to skip ahead or go back for previous content, no problem! See below for links and summaries for every segment of our amazing interview with Tower Paddle Boards founder Stephan Aarstol.

Segment 1: Introduction To Tower Paddle Boards And Founder Stephan Aarstol

In this segment, we dive into where it all began for Tower Paddle Boards. We cover Aarstol’s background in online marketing, and how he pivoted away from his poker chip company to pursue his hunch that paddle boards would soon be mainstream. Read more >>

Segment 2: The Shark Tank Effect At Tower Paddle Boards

When Shark Tank came calling, Aarstol answered, and Tower Paddle Boards took off like a rocket ship. But it almost didn’t happen—Aarstol froze on stage, delivering what he calls “the worst pitch in Shark Tank history.” Learn how he crashed, recovered, and landed a deal with Mark Cuban. Read more >>

Segment 3: How Tower Paddle Boards Cut Out The Middlemen And Delivered More Value To Consumers

How did Aarstol figure out how to cut out the middlemen and deliver Tower Paddle Boards direct to consumer, for half of the retail price? In this segment, Aarstol explains how he overcame the price-fixing of the industry’s dominant players to bring consumers lower prices, higher quality, and better service. Read more >>

Segment 4: How Tower Paddle Boards Sourced Factories

When building a direct to consumer business, finding a dependable factory is a competitive advantage, Aarstol says. In this segment he reveals his best tools and tips in sourcing factories: how to find the best ones, how to avoid the scams, and why anti-competitive behaviors are a sign of bigger problems. Read more >>

Segment 5: The Retail Equation At Tower Paddle Boards

“We never want to be that company that just pads our direct-to-consumer margins so we can accommodate retail partners that are taking a 50% cut,” Aarstol explains. In this segment, you’ll learn how Tower Paddle Boards uses their core principles to evaluate retail opportunities. Read more >>

Segment 6: Tower Paddle Boards on Amazon

For direct to consumer brands, Amazon is the elephant in the room. In this segment, Aarstol explains how Amazon has become expensive for consumers and crowded for brands—and why he believes Amazon is merely an online convenience store, carrying the high markups of offline retail middlemen. Read more >>

Segment 7: Disadvantages Of Amazon For DTC Brands Like Tower Paddle Boards

Amazon was good for direct to consumer businesses—until it wasn’t. In this segment, you’ll see the astronomical sales numbers Aarstol enjoyed in the early days, but also the growing challenges: disconnected customer service, increased return rates, and increased fees. Read more >>

Segment 8: Will Tower Paddle Boards Walk Away From Amazon?

Is it time for direct to consumer brands to leave Amazon? How will they survive if so? In this segment, Aarstol explains the two consumer behaviors that he believes will not change in the future, and why that’s good news for brands like Tower—helping them survive without Amazon. Read more >>

Segment 9: On The Horizon At Tower Paddle Boards

What’s next for Tower Paddle Boards? In this segment, Aarstol reveals his perspective on the ideal balance between pricing and quality, and how keeping expenses low (and advertising minimal) impacts Tower’s ability to expand into popular products with exceptional value for consumers. Read more >>

Segment 10: What Informs New Product Ideas At Tower Paddle Boards

By living the beach lifestyle themselves, Aarstol’s team has insights into new products and quality design. “If a company out of New York is creating beach lifestyle products, they really don’t understand the market as well as we do,” Aarstol says. “Our brand has this authenticity, because we’re making products that we know.” Read more >>

Segment 11: What Tower Paddle Boards Is About (From A Value Standpoint)

Tower Paddle Boards went in two unique directions, when it comes to delivering value. Product development is focused on what the consumer needs (not what it costs), and team productivity is fueled by Aarstol’s revolutionary idea to live more by working less—with a five-hour workday. Learn the secrets behind Tower’s popular products and productive culture. Read more >>

Segment 12: Tower Beach Club Offers New Experience With Tower Paddle Boards

In this segment, you’ll learn how Tower Paddle Boards is taking the beach lifestyle experience to an entirely new level with the launch of Tower Beach Club in San Diego. Whether you’re a fan of Tower, or a direct to consumer brand exec, you’ll want to read the innovative retail plans and fun experience ahead for Tower customers and visitors. Read more >>

Segment 13: Connecting with Tower Paddle Boards

As we wrap up the interview, we provide links and information on connecting with your favorite Tower brands—from paddle boards to sunglasses to electric bikes—as well as how to reach out to Tower Founder & CEO, Stephan Aarstol. Read more >>