How SharkNinja took over the home

Support for this show comes from Salesforce. Today, every team has more work to do than resources available. But Digital Labor is here to help. Agent Force, the powerful AI from Salesforce, provides a limitless workforce of AI agents for every department. Built into your existing workflows and your trusted customer data, Agent Force can analyze, decide, and execute tasks autonomously.

letting you and your employees save time and money to focus on the bigger picture, like moving your business forward. AgentForce, what AI was meant to be. Learn more at salesforce.com slash AgentForce. This episode is brought to you by Indeed. When your computer breaks, you don't wait for it to magically start working again. You fix the problem. So why wait to hire the people your company desperately needs?

Use Indeed's sponsored jobs to hire top talent fast. And even better, you only pay for results. There's no need to wait. Speed up your hiring with a $75 sponsored job credit at Indeed.com slash podcast. Terms and conditions apply. Hey, it's Ryan Reynolds here from Mint Mobile. Now, I was looking for fun ways to tell you that Mint's offer of unlimited premium wireless for $15 a month is back. So I thought it would be fun. if we made $15 bills. But it turns out...

That's very illegal. So there goes my big idea for the commercial. Give it a try at mintmobile.com slash switch. Upfront payment of $45 for a three-month plan equivalent to $15 per month required. New customer offer for first three months only. Speed slow after 35 gigabytes of networks busy. Taxes and fees extra.

Hello and welcome to Decoder. I'm Nilay Patel, Editor-in-Chief of The Verge, and Decoder is my show about big ideas and other problems. It's summertime, which also means it's time for our annual grilling episode here on Decoder. It's one of my favorites. In years past, we've talked to the CEOs of Big Green Egg, Traeger, and Blackstone. And it's always fascinating how those companies have all of the same kinds of problems and ideas as any of the tech companies we have on the show.

In fact, it's funny, in what can only be described as a perfectly decoder situation, I really wanted to have Blackstone CEO Roger Dahl back on the show this year. Because the griddle company he started is such a success that he's in the process of buying Weber, the biggest name in the space. But he stuck an antitrust review so he couldn't be on the show. Grilling episodes, man. They're the best.

Anyhow, all that meant that I finally had the opportunity to have Shark Ninja CEO Mark Barokas on the show.

we've wanted to have shark ninja on the show for years now mostly because it has the best and most appropriate name of any company i've ever wanted to have on decoder shark ninja it perfectly describes the structure of the company there's shark and there's ninja and just in time for our grilling episode, the Ninja division of Shark Ninja just launched its first ever grill, the Flex Flame, earlier this year.

But as I hear Mark and I really get into, Shark Ninja has what you can only describe as a kind of relentless approach to product development. The company launches 25 brand new products a year across dozens of categories and countries around the world.

So while we spend a lot of time talking about the decision to launch the Flexfame Grill and what the business of grilling looks like for Shark Ninja, you'll hear Mark and I talk a lot about the company's broader philosophy around product development in all of its different categories.

That's because a lot of that philosophy, which was developed back in the late 2000s for markets like vacuum cleaners and air fryers, is now being applied to everything from slushy machines and pizza ovens to portable blenders and LED beauty masks. Really, Shark Beauty is a growing concern for Shark Ninja. You'll hear Mark explain that the company has a product engineering and design team of more than 1,300 people around the world dedicated to figuring out new twists on household staples.

It's also remarkable how many of these products are built around fans, which comes up a few times in this conversation. In fact, a key component of the new FlexWing reel is a fan that lets it do a lot of different things. But the grill industry, as you might know from our previous episodes, is fiercely competitive and there's tons of brand loyalty. Product features alone might not be enough.

I can't tell you how many furious reader comments and emails we got last year when the CEO of Big Green Egg took a shot at Weber. People love their grills, and they fiercely defend them. So I really wanted to ask how his style of product development worked in the context of grills, and whether he's envisioning Ninja's outdoor grilling products as premium devices you keep for a long time, or ones that might rust and get replaced after a few years, like so many other grills in the market today.

I also wanted to talk to Mark about the future of advertising and marketing. Shark Ninja spends more than $700 million a year on advertising, almost all of which goes to product placement and content creators on Instagram and TikTok.

You'll hear Mark put that in the context of his own personal history, selling vacuum cleaners on television infomercials back in the 2000s, and how that's evolved into his creator marketing strategy, which helps Shark Ninja products become viral sensations at a pretty consistent clip. Mark has a lot of thoughts about the state of the creator economy, which is in the process of being totally upended by cheap and limitless AI video. So I wanted to know whether he sees what I see.

that this whole thing might be on the edge of a crash that could transform how everyone markets and sells products online. I wouldn't say he agrees with me, but he doesn't totally disagree with me either.

This episode's a real ride. Mark's background from infomercials really comes through at times, and I think you can tell that I found myself just trying to hang on throughout this one. I think you're going to like it. Okay, our annual grilling episode with Shark Ninja CEO Mark Barocas. Here we go. Bye.

Mark Rokas, you're the CEO of Shark Ninja. Welcome to Decoder. Thanks so much for having me. I am really excited to talk to you. I'm fascinated by Shark Ninja as a company. It's been around for a long time, but you're having a bit of renaissance lately. And then on top of that, this is our annual summer grill episode. And you guys have just launched a new line of grills. So it's perfect timing.

Couldn't be happier about it. Great. Really happy to be here. Let's talk about Shrek Ninja as a company just to set the stage a little bit. I think a lot of people know Shrek. A lot of people know Ninja. You started marketing sort of the main company a little bit more recently. Tell me about this company. Why have the two brands? How is it structured? How do you think about Shark Ninja as a company? As you said, I mean, the...

business behind these two great brands is Shark Ninja. And people know the Shark brand. We built the Shark business to over a $3 billion global business. We have the Ninja brand, you know, which is over a $3 billion global business.

Now, more and more, we're actively marketing the Shark Ninja business behind these two great brands and trying to explain to consumers that we're problem solvers. I mean, that's what our business is all about. I mean, we... find problems that others don't see and we solve problems that others can't and we can get into more around how we do that and why that's unique to shark ninja But we're in 37 product categories. We sell in 27 countries around the world. Everyone from a...

High school kid is doing a TikTok or an Instagram video about our products, all the way up to a 60-year-old guy that's focused on outdoor grilling or smoking. We've got a big demographic base of consumers, a big socioeconomic group of consumers. The idea that you're going to market the central company, Shark Ninja, as problem solvers, this comes up, right? There are lots of big sort of household brands that exist in that space. In the kitchen, I think OXO.

is very famous for this. Everything is somewhat uniquely designed, a little bit different. They're not direct competitors to you, but the marketing there feels familiar. This is going to be the highest bit of design product that you can get. There are lots of others that sort of play the same game. Is that what you're thinking about? You want people to think of you as a design company, or is it something else? No. I mean, we want people to think of us as a consumer problem-solving company.

You know, you can focus on consumer products and look at it through a technology lens and you say, hey, I have this core technology and I'm going to take this core technology and I'm going to apply it to. two or three or four different categories of products that might be applicable. Our core technology is consumer problem solving, is we've got a big team of ethnographic consumer insights researchers. We're mining consumer data, you know, online reviews, social media content.

We're in hundreds of consumer homes around the world every year. We're in restaurants. We're in commercial environments of how do people clean or cook in those environments. And we're trying to find either...

a problem that a consumer has that they may not even know that they have, and we can talk about examples of that, or we're trying to find things that the consumer is doing outside of the home that they're not doing inside of the home. And I think those two... different things become ultimately the germs of innovation and ideas that we then...

focus our 1,300 engineers around the globe to solve those problems. And you say, well, hold on, vacuum cleaners, I mean, they've been around for 100 years. I mean, hasn't every problem been solved? I mean, I'll give you a great anecdote. we went into 100 consumer homes and we watched consumers vacuum. During the cleaning session, about eight or 10 of those turned over the vacuum, took a knife or a scissor, sliced the hair off the brush roll.

pulled the hair off, threw it in the garbage, finished their cleaning session. And at the end of the cleaning session, we said to them, is there anything you do to change your vacuum cleaner? And they said, no, it works great. And we said, well, hold on a minute. How about that time when you turned it over and you nearly cut your hand and you sliced it? And they said they started apologizing for the product. They started saying, well.

I have two daughters with long hair. I have three dogs. Yeah, of course. I mean, a consumer kind of works around the problems of the product. Well, for us... That becomes an idea. So we go back to our engineers and we say to our engineers, can we develop a vacuum brush roll that doesn't wrap hair? 18 months later, we come out with Shark's self-cleaning brush roll. It becomes the number one selling vacuum cleaner in the United States.

So there's just a little example, you know, and we do that category after category after category, which is why we're not limited to two or three or four categories, but we're in 37 different product categories in and outside the home.

There's a lot there that I want to unpack. You're talking about a lot of upfront investment in product development. Many of your competitors don't do that. They really do take some core technology and reapply it in different categories.

Many of your competitors are based in China, right? They're selling on Amazon. They're selling clones of your product. They don't have to front that investment and they can keep their costs low. How do you think about that dynamic? Because what you're describing requires you to constantly...

front the cost of innovation that will almost certainly get copied at high rates across the board there's two you know main competitive advantages of shark ninja i mean one is disruptive consumer innovation i mean we spend seven percent of our sales on R&D and innovation, okay, in an industry where there's competitors that spend 1% of sales, you know, or less than that on innovation.

We bring 25 new ground-up products to market a year. I'm not talking about a new product as a new color or a new button. These are ground-up, brand-new products across so many different product categories. we enter into at least two new product categories every year. Things that we've never been in before. I mean, before last year, we were never in the skincare business. We were never in the cooler business, outdoor coolers. If you think about last year, you know, we went into four.

new product categories. We made an LED infrared cryo face mask, which was our first FDA approved medical device. We launched a slushy machine, the ninja slushy that went viral on social media. We made our first outdoor pizza oven. product. I mean, you can't think of, you know, more diverse categories. The common stream through all of those is they all solve some sort of consumer problem. I think this is a great time for the decoder questions. Usually we do some like...

controversy at the top, but you're describing something that's so interesting that I think the structure will actually help explain a lot here. How is Sharkins structured? How many people do you have and how is it organized? So we've got nearly 4,000 people around the globe. From a structure standpoint, I mean, we have an executive management team that is half homegrown, who's been with me. There's people that have been with me for 17 years.

rounded out with other folks that have joined the organization that have been able to bring scale experience or global experience into their areas. Areas like product development and engineering and sales and marketing. You know, those folks have been with me a long time. I mean, we've really helped build kind of the Shark Ninja secret sauce together. And we've rounded that out with great talent from other great companies, other great experiences to build a really strong management team.

And then how is that organized? Do you have a shark division and a ninja division? Is it all one company? How is that expressed? From a functional standpoint, let's call it the administrative roles are all corporate shark ninja. I mean, there's a corporate CEO, there's a corporate general counsel, there's a corporate COO, there's a corporate people and culture leader. When you start to get into the click down on the individual teams, we break it up into shark home.

our home business, which is like cleaning, home environment products, fans, air purifiers. We have a shark beauty business, which is hair care, skin care. And then we have a ninja business, you know, which is everything that we do with a ninja.

That's kind of how we like to think about breaking down the business. There's two brands, but inside of those two brands, there's a Shark Home business, a Shark Beauty business, and a Ninja business. If I look at that broadly and I just look at your competitive set, Shark and Dyson have always...

Been back and forth. There's been some lawsuits. There's been some patent disputes. Some of those have settled over time. There's a lot there, right? To your point, Dyson invented some fan technology. They tried to express it across a number of different products that led them into beauty.

They got to hair dryers, then they got to the expansion into the rest of the beauty products there. They've done well. Is that how you think about Shark? You started with core technology, you ended up at beauty, and now you're going to do the rest of it there?

If I go back 17 years, I mean, we were a small business. $150 million business that I'd love to say that there was a grand plan of how do we become a $6 billion global business without acquiring a dollar of revenue. Could you tell me? That would be great. Yeah, I would be lying to you if I said there was. I mean, to be honest with you, I mean... we just wanted to make great products that consumers loved. I mean, if I go back to 2008,

what we realized was the consumer was getting more and more power in terms of understanding and being educated before they made a purchase. So if I go back to 2008, there was a thing called Consumer Reports. You opened up Consumer Reports, and they told you the eight vacuum cleaners to buy. And if your vacuum cleaner wasn't listed in there, you were going to have a really hard time gaining awareness.

What my partner and I at the time realized was the great equalizer was going to be consumer online reviews. You listen to that today and you say, well, what kind of great equalizer is that? Well, people so often before that bought off a brand or bought off of some one person, an expert recommending it to them. What started to happen was consumers started going online and they started writing reviews.

honest reviews about their experiences with products. And consumers, before they were going to go out and make a purchase, they weren't going to open up consumer reports. They were going to go online. and look at 10 million of their closest friends and say, which vacuum cleaner should I buy? Which blender should I buy? And they were going to get honest opinions. And, you know, that, Eli, is one of the major drivers of our business. If I go back 15 years ago.

We've built our business one five-star review at a time. So if you've had a great experience with a shark vacuum, you say, hey, I might try shark air purifiers that just came out. Or I might try, wow, they got into hair care. I might try them in hair care.

It's interesting, you know, what we look at very much is what gives us the right to be in the category. The right to be in the category is not because you have a brand that you can just put your name on something and say, hey, there's a sales opportunity. What are we bringing to the consumer that they can't get anywhere else? That's an unmet need that the consumer has. And we set a very high bar on that within the company.

There have been categories that we've worked on for 10 years and never brought them to market because ultimately we've come to the conclusion the consumer doesn't need us. The world doesn't need us. And so... Being able to kind of be anchored on this beacon of what gives us the right to be in the category has kind of led us very methodically to the next opportunity, the next opportunity, the next opportunity. What's one that you've been rejecting for 10 years?

You know, I've loved the power tools business. I think the Shark brand can translate into power tools. I mean, we used to think of ourselves as in the home. I mean, we're making a lot of products now for outside the home. And I thought Power Tools was a great opportunity. We've tried it. And ultimately, we decided, you know, let's go back to the drawing board. Now, I will tell you also, there are categories that we tried for eight years, and we eventually cracked the code.

And an example of that is a category called carpet extraction and stain cleaners. We became the number one selling vacuum brand in the United States in 2014. Ever since then, in 2014, retailers and consumers would say, you know, why aren't you getting into the carpet extraction business? You know, the carpet cleaning business. That seems so logical from a brand extension standpoint.

And the honest answer was we never came up with something that was that great. We finally cracked the code on that about two and a half years ago, and we launched a product into the market called the Shark Carpet Expert. It cleans carpets better than anything else that's in the market. It does it, and it's much more lightweight, much more easier to use. And it does it by also having an attachment that goes on it called the Stain Striker.

we in a very short period of time have gained over 20% market share in that category. So it shows us that like, just because we might... bang our head against the wall a couple of times, we may eventually crack the code. We may figure it out. And when we do figure it out, the innovation really connects with the other competitive moat that the business has.

which is creating viral demand for our products. We spend 11% of sales on advertising. Again, in an industry that spends very little on advertising. And so... When you've got a disruptive product that solves a consumer problem and you're able to go out and you're able to talk about it on things like social media and experiential events and TV, when those things come together and you get it right. It really connects with the consumer and not just in the United States, but globally.

I want to come to that. That's a really fascinating piece of the Shark Ninja story, and I think tells a bigger story about the advertising market, particularly on the internet, than anyone really is giving credit to yet. But I want to stay in structure for one more second. So you've got Shark Home, Shark Beauty. and Ninja. Ninja feels like kitchen products. Kitchen and outdoor. So we do outdoor cooking, we do outdoor coolers, kitchen and outdoors.

At the company, you've got 1,200 engineers. Are they split between divisions? Do you have central engineering? Do they compete for resources? How does that work? We have 1,300 engineers today around the globe. They're based in Boston, London, and Asia. There are certain... functions within the company like electrical engineering that might go, you know, across different categories. I mean, they're kind of subject matter experts.

But I think it's not just the number of engineers that we have. It's the competency of those engineers. We've got mechanical engineers, electrical engineers, mechatronics, app IoT, software engineers. And I think you'd be really surprised as you went inside of one of our products. You could take a product that retails for $199.

there's an enormous amount of technology in there. I mean, if I went back seven or eight years ago, most of it would really be mechanical engineering. I mean, today, the software team and the electronics team... together with the mechanical engineering, has allowed us to be able to bring so much more functionality to the product, allow the consumer to have so much versatility with it than they've ever been able to before.

So when the ninja team says they've got an idea for gas grill and they need a bunch of software engineers to work on the app to run the flex flame system and those same engineers are being pulled towards the next. shark beauty projects. How do you divvy up those resources? It's a challenge. But here's what I'd say that's super exciting about it. If you're an engineer and you work in a company that has one product category that you sell,

Eventually, after three years, four years, five years, you get to the point where you say, look, I've gotten tired. I mean, if I want to go to another opportunity or I want to work on something else, I have to go find a job in another company. At Shark Ninja, you can find your next job within Shark Ninja.

You've been working on vacuum cleaners for three years. You want to try something different? How about air fryers? How about outdoor cooking? How about fans? How about robots? You know, how about hair dryers or skincare? So I think the... cross-pollination of engineers is something that's so powerful for us. I mean, our ability to work on a category...

And to put out, you know, an intercompany message to say, does anyone have experience in LED lights? Does anyone have experience in, you know, airflow technology? To be able to see internally the number of experts that we have. is something that's incredible. I mean, you might, you know, if you're a company, you might have to go outside and find a whole lot of subject matter experts. We have a whole lot of subject matter experts inside that are kind of red teaming each other's products.

Right, but the joke I'm always making on Decoder is that if you tell me your company's structure, I can tell you 80% of its problems. You're describing two big divisions, both of which are growing, both of which are aggressive, launching new products. Inside of them, they have some subdivisions. I'm guessing if the ninja team steals a bunch of LED lighting engineers from the shark team, they're not happy about that. That's you. You've got to mediate that.

dynamic. How do you mediate those resources? How do you allocate them? A lot of it comes down to the needs of the product, okay? I mean, we really don't look at it by a shark brand rigidly and a ninja product rigidly. I mean... We start with a product pipeline of ideas, and that product pipeline of ideas might be 65 ideas that we start with. And over the course of time, we whittle that down. I mean, we might put something into a prototype, get it into a consumer home.

We thought it was a great idea. The consumer says, hey, I'm not that interested in it. We throw it away. You know, we might put something just on a packaging front. We might not even put it into a prototype. We might show them a box front and say, hey, does this get you excited? We might look at something and say, it's great, but it's too expensive. We don't think it's commercially viable. Maybe it's too early for the consumer.

Maybe there's a problem, but the consumer doesn't even know yet that it's a problem. I'll give you an example. In the city of New York, they just mandated composting. It's very interesting. A New York apartment is going to have to sit there with their food scraps, putting them into this little plastic bin and this little bag. They're going to have to wait seven days. What do you think happens to that bag at day four and day five?

Doesn't smell great. I mean, it doesn't. So we had some young engineers that were super passionate about solving that problem. The challenge with it, though, is it's not in enough municipalities. The consumer hasn't engaged with it enough to realize what the problems are.

It may be something that is incredible. It might just be something that's two years too early. So we'll kind of put that in the parking lot and we'll say, let's go revisit that when it comes to the next product innovation cycle. We really do look at it at the product level and not at the brand level or at the company level. And I think that's what really helps us to be able to assess how do we divvy up resources. And the other thing I would say is...

We use a tremendous amount of outside experts. This is a company where it does not have to be invented here. We are looking for the best and brightest people to help us solve consumer problems. we could be working with as many as 50 outside subject matter experts. They could be on things as little as gear systems. They could be as little as some sort of troubleshooting on a particular heater that we might have.

That's something that I don't want to underestimate because in a lot of engineering companies, the engineers feel like, well, hold on, you hired me to solve it. I have to solve it. We're sitting here saying, listen, at the end of the day, we want the consumer to open up the box and enjoy the product. And the consumer doesn't care whether you made 100% of the product internally or whether you brought in five subject matter experts to help.

We do, I think, a really, really incredible job of going after and getting the best and brightest people to help us solve these problems. We need to take a quick break. We'll be right back. Support for this show comes from Vanta. Starting or running a business comes with a lot of responsibilities beyond just having a great product. Making sure you're compliant with security protocols, especially those designed to keep customer data safe is one of them.

Vanta helps companies of all sizes get compliant fast and stay compliant with industry-leading AI, automation, and continuous monitoring. And Vanta saves you time by helping you complete security questionnaires up to five times faster. A recent IDC white paper found that Vanta customers achieve $535,000 per year in benefits. No wonder more than 10,000 global companies trust Vanta, including Atlassian, Cora, Chili Piper, and Factory.

So whether you're a startup tackling your first SOC 2 or ISO 27001 or an enterprise managing vendor risk, Banta's trust management platform makes it quicker, easier and more scalable. Establishing trust isn't optional. Vanta makes it automatic. Visit vanta.com slash decoder to sign up for a free demo today. That's V-A-N-T-A dot com slash decoder.

Support for Decoder comes from .tech domains. Launching a website can be exciting. You can finally show off your startup, complete with great layouts and dynamic UI. But the hard part is trying to find the proper domain name. Sure, you've got a great name for the startup, but the web address is something else entirely. It's a cluttered dot com with fillers and added words because the best ones are either taken or priced like down payments on a condo.

But your domain is one of your startup's first brand signals. So it's time to get a clean, sharp, and memorable .tech domain. DotTech signals loud and clear that tech is at your startup's core. A DotTech domain shows your focus and attempt. It builds credibility with VCs and customers, and anyone who sees it knows it instantly. This is a tech startup. If you're building a tech startup, you want a .tech domain. It just makes sense. Head to www.get.tech.

or a domain registrar like GoDaddy or Namecheap and grab your perfect .tech domain today. That's get.tech slash decoder to grab your perfect .tech domain. Support for this show comes from agency. What we have here is a failure to communicate. That's not just a great line from Cool Hand Luke. It's also an accurate assessment of the current problem with AI development. Right now, there's a fundamental gap in how AI tools can complement each other.

While single agents can handle specific tasks, we have no standardized infrastructure for these agents to discover, communicate with, and work alongside each other. That's where agency A.G. n t c y comes in the agency is an open source collective building the internet of agents a global collaboration layer where ai agents can work together it will connect systems across vendors and frameworks solving the biggest problem

of discovery, interoperability, and scalability for enterprises. With contributors like Cisco, Crew AI, LangChain, and MongoDB, agency is breaking down the silos and building the future of interoperable AI. Shape the future of enterprise innovation. Visit agency.org to explore use cases now. That's A-G-N-T-C-Y dot O-R-G. Agency.org. We're back with Shrek Ninja CEO Mark Barokas.

Before the break, we're getting into the decoder questions, including how a company that's composed of two big product divisions is actually structured, how resources are shared, or in some cases not shared, and how that ultimately helps a company like Shark Ninja decide what products to make.

So now I wanted to talk to Mark about how he makes decisions about what new product categories to enter, which Shark Ninja seems to do at an almost nonstop clip. Get ready. We're about to spend a lot of time talking about vacuum cleaners. I think that really comes to...

How do you think about investing in the core technologies? So I'll just stick with Shark and vacuum cleaners and blow dryers and air purifiers. The core of that technology is high efficiency, small motors. It can move a lot of air. You can express that in multiple different kinds of products.

That's a very competitive segment. That's the patent lawsuits, right? It's deeply competitive. You can go buy that core technology. Once you've developed it, the goal is to ramp it over time and take margin out of all that upfront cost.

But you're launching into so many new categories. You're going out to buy lots and lots of new core technologies from 50 different subject matter experts. How do you think about managing those life cycles? Where do you think about spending the money on new technologies that will –

last for a long time and let you take margin out of it? Where do you think the technology is mature and what you need to do is expand the category? I'll go back to the example that you gave on vacuum cleaners, because I think that's a good one. We have a patented... technology of no loss of suction, vacuum technology, that the consumer can pick up whatever they want in that vacuum and you're not going to lose any appreciable level of suction over the life of the product.

But there are lots of other, as you start identifying the next consumer problem, you start having to then build evolutionary or add-on technologies. And I want to give you some examples of that I think you might find interesting. While we developed our first vacuum cleaner was called the Shark Navigator. We had great no loss of suction technology. We cleaned carpets better than our competition. And we did it at a fraction of the price.

Okay, those were kind of three core things we found at the time, and this is going back to 2009. that the American consumer was really interested in cleaning carpets. That was the proxy for them of a great cleaning vacuum cleaner. 2010 comes and we say, okay, well, what's the next problem for us to solve? We go into consumer homes. We watch consumers vacuum. And in the homes that had stairs or multi-level homes, they would plug the vacuum in.

They would go and they'd pull a hose out and they'd clean the first three steps of the stairs. They'd then unplug the vacuum, walk upstairs, plug it in, and they'd clean the top three steps. The middle three steps would never get clean because the hose would never be able to reach to that. So we looked at that and we said, well, why is the vacuum tethered?

to this base that's on the ground that's cleaning your floor, what if you could lift it away and you could now walk around with the vacuum cleaner and have 30 feet of travel with the cord? That product was called the Shark Lift-Away.

it's still the number one selling vacuum cleaner in the United States. Okay. And it was a problem that we solved, you know, by being able to have vacuums that not only clean on the floor, but clean above the floor as well. So now you say, okay, well, hasn't everything been... Well, three years later, we say, well, what's the next problem? The next problem is, how do you clean under furniture? You don't want to move the furniture.

I mean, how do you clean under a bed? I mean, imagine what under a bed looks like when you haven't cleaned it for two years. You know, so we developed something called Powered Lift Away. You picked up... the canister off the vacuum. We had power that went down through the hose and went to the nozzle. And you were able now to take your nozzle just like a canister vacuum and go anywhere under furniture or under beds.

That became the number one selling vacuum cleaner in the United States when it came out. So you say, well, has everything been invented? We then went a few years later and we said, wow, we do a great job of cleaning carpets, but we weren't doing as great a job on cleaning hard floors. With carpets, you need a really aggressive brush roll to clean.

On floors, you need to be able to pick up the fine dust. So we looked at that and we said, well, that's in conflict with one another. What if we developed a vacuum cleaner that had two brush rolls? An aggressive brush roll that cleaned your carpets. and a more fluffy brush roll that was able to pick up the fine dust on your hard floors. And that technology was called Shark's Duo Clean technology. And ultimately today, I mean, that's still our best-selling vacuum cleaner.

Again, when you keep finding the next problem and the next problem that leads you into kind of, you know, new technology, new evolution. And by the way, I mean, all of these things that I just mentioned to you. They're all patents. You know, they're all things that only Shark Ninja does at this point. But we're constantly on this quest to now keep finding what's the next problem, the next problem. And then that leads us into our innovation pipeline.

I'm going to push back in just a little bit. The vacuum cleaner market. I know the decoder listeners quite well. And I know what they're saying to you in their cars as they listen to you. The vacuum cleaner market. is pretty mature. It is ferociously competitive. There are products from LG and Samsung and Dyson and you name it that do all of these things and more in different ways.

I hear what you're saying. You see the problems and you kind of innovate to the customers that you see and the problems they have. But the market is competitive. How often do you spend thinking about where the market is going, where the competitors are getting ahead of you and you have to leapfrog them? Every day. I mean, this is what we do. I mean, we're consumer problem solvers. I mean, every day we're trying. I mean, we had 0.0 market share in the vacuum industry in 2008.

In the upright vacuum cleaner market in the United States, which is the largest portion of the vacuum cleaner market in the U.S., Shark Ninja has over 40% market share today. We became number one market share. in 2014 and we've never given up that number one market share Why? Because we're continuing to innovate and innovate and innovate. We're driving up average sell price, you know, where, you know, you could buy a shark vacuum at $129. You could buy a shark vacuum at $499.

I mean, we are bringing the opening price consumer up into our brand where, okay, we don't have something to, you know, for the $79 consumer. But I think what the consumer looks at is they look at performance. They look at value, they look at quality, and they look at innovation. It's all four of those things together that you've got to be able to bring to the consumer.

I think you might have innovation, but the consumer needs all of this and value is a huge component of it. The opening price consumer can step up to $129 shark vacuum. The high price Sephora Ulta consumer, you know, can buy a $499 vacuum, but there is no brand that cuts across such a broad price point range and such a broad feature range. And the other thing that I think we do a really effective job of is we want to be the vacuum for you when you move into your dorm room.

In college, we want to be the first vacuum for you when you get your first apartment, when you get your first house, when you have your family and you've got your first pets, when you wind up being an empty nester. And I think there isn't a brand out there selling corded vacuums, cordless vacuums, robot vacuums, hand vacuums, shop vacuums that is doing such an effective and compelling job of innovating. but also doing it with extraordinary value and great quality.

One of the things I think about a lot here is how do you grow, right? You're describing people buying lots of vacuums over time. A long time ago, I had the former CEO of Sonos, Patrick Spence, on the show, and I said, is your whole plan that people will just get bigger and bigger houses and you'll sell one more speaker?

Every time. Is that the plan in the vacuum business? People are just going to buy new vacuums at a steady clip? I think the more macro question is, how do we grow and how do we think about growth? OK, and we think about growth in this three pillar growth strategy. You know, one is. gaining share in the existing categories that we're in. You know, we enter categories and within three to four years, Shark becomes or Ninja becomes the number one or number two market leader in that category.

There's still lots of white space within our existing categories. I mean, we're in an industry with an available TAM of $120 billion. You know, last year we were a $5.5 billion business. So, you know, we're less than 5% of the overall market. Number two is expansion into new product categories. I mean, many companies can say they can expand into new categories, but either the retailer or the consumer.

doesn't let them go into those new categories. I mean, they don't see them in those categories. And I think we've been really effective at kind of taking the Shark and Ninja brands into so many different places. And then third is international expansion. I mean, this year, you know, over 40% of our business is going to come from outside of the US. So, you know, when you think about, you know, brands that are really able to scale globally, I mean, we launched 25 new products a year.

20 out of those 25 products we sell in every market. The same product, we look at the consumer from a product innovation standpoint across this matrix of how does the American consumer think about a product. How does a European consumer think about the product? How does an Asian consumer think about product? But I think that's an important point to note is that we're not just innovating for one type of consumer, we're innovating for a global consumer.

I'm going to ask you the other decoder question, and then I want to talk about expansion, particularly into grilling. This is our grilling episode. We spent too much time on vacuums, man. But here's the other decoder question. How do you make decisions? You've laid out a lot of frameworks here. It's clear you thought about this a lot. What's your framework for making decisions?

We have something and you can go to our website and you can see it. We're very focused on culture. Okay. Like culture is our competitive advantage. Okay. It really is. I mean, look, we have 5,000 patents. We have great brand names. We have incredible innovation. What has enabled us to grow at a compounded annual growth rate of 21% a year for the last 17 years? It's the way we think, okay? And I'd invite you to go onto our website and look at a document called Outrageously Extraordinary.

And this idea is that we have this inextricable desire to want to be the absolute best we can be. And what comes with that is this inherent fear of failure. And how do we get rid of the fear of failure? Because you tend to play it safe when you're worried about failing. And so for us, we set what we call these unimaginably high bars in a game worth playing. seldom will you see in Shark Ninja that you'll be sitting in a meeting and saying,

Let's go after this, where everyone in the room walks out and says, oh, I think we can do that. Most people are going to walk out of the room saying, how the hell are we going to do that? OK, we've just set a bar that seems absolutely impossible. We think that courageous leaders, you know, really set an unimaginably high bar in a game worth playing. And even if you fall short to that.

you know, you will still do something extraordinary. I mean, if I set out, you know, to say that we want to be number one market share going from zero, you know, and that's our goal, and we wind up being number two. Hey, I mean, we started from zero. So we've got a set of very high bars where it starts with. The second is this idea of leading with a relentless desire to know more. Answers in business are not surface level. People want to have an easy answer to a tough question. The answers lie.

deep, deep, deep in the business, trying to understand what really is the root cause to the problem. What is the mousetrap that you're going to be able to create that is going to be sustainable, that's not going to be able to be disintermediated by a Chinese factory that might come in and sell a low-cost product on a platform or something like that. So how do we have this desire to know more or know more than anyone else that is competing against us?

We want to be an explorer, not a tour guide. I mean, most of what we're doing, we're in uncharted territories. I mean, my expertise ran out eight years ago, okay? I'm running on fumes when it comes to expertise at this point. I mean... Every day, we're exploring new territory. I mean, we are, you know, we're pivoting quickly. I mean, we're getting smarter every day. I mean, we use this term in the company, we reserve the right to get smarter.

Make a decision, new information comes in, decide tomorrow we're going to change the decision. I think one of the things that many companies or many leaders get stuck in is they say, I made a decision, so I just have to go in that direction. We want to constantly be on the lookout for, is the decision that we made stupid? I mean, I stood up in front of our town hall in front of a corporate meeting a number of months ago. There were some questions about some changes that we had made last year.

And I said to the organization, I made a change because previously I was being stupid. And I've decided now to be un-stupid. And the concept of un-stupid became something that, you know, went viral around the company where people felt empowered to say, I want to be un-stupid today. We're going down this path. It doesn't seem like we're going to be successful.

Let's pivot and let's change. There's no harm. Shark Ninja is not curing cancer. We're trying to delight consumers. We're trying to positively impact people's lives. And so the change that you mentioned is that... the way that we were investing dollars in the company. I mean, we have to stay focused in investing dollars in areas of growth.

Growth when it comes to product development, growth when it comes to geographic expansion, growth when it comes to marketing and building awareness for our brands. I think we got too scattered. I think we went after too many shiny objects. OK, I think there's lots of great initiatives for a company to go work on, but you also need focus and you need to make sure that like there are certain things that are.

you know, sacred in a company. And that's what requires the investment. And everything else might have to kind of wait in line to get done. You just can't do everything at once. And so we had to pull back on some of those things and we had to...

Make some tough decisions as to where we were going to invest and where we were going to hold for a little while. And then, you know, we look at it as we go into the next year. This is a perfect tee up to your decision to invest in grills. But I have to know, what did you pull back from? Was there anything specific? I think we went after a lot of technology projects. We were implementing Oracle in our company. We were replatforming our e-commerce site.

We've got this great partnership with Salesforce, you know, and we're launching a new e-commerce site in September of this year. And so there were certain things that were just really mission critical. There were other things that were really just...

nice to haves. I mean, they were not going to make or break our business. They were not going to create a competitive advantage. And so we had to make the decision of, you know, what are the things that are most important and what are some things that, you know, now is just not the right time for. we need to take another quick break we'll be right back

Support for this show comes from Salesforce. You might remember a time not long ago when AI wasn't all that helpful. But today, Agent Force, the powerful AI from Salesforce, can analyze, decide, and execute tasks.

autonomously, operating at speeds and scales no human workforce could match. These AI agents represent a new world of digital labor that not only handles monotonous, low-value work, but orchestrates and carries out high-value... multi-step tasks this isn't just another step forward it's an enormous leap redefining how work gets done and what's possible for businesses and their employees agent force is adaptable

Autonomous and proactive. And, of course, totally integrated into Salesforce. So they're truly part of the team. That way, you and your employees can focus on the tasks that actually move your work forward. Agent Force. What AI was meant to be. Learn more at salesforce.com slash agentforce. On WhatsApp, no one can see or hear your personal messages, whether it's a voice call, message, or sending a password.

To WhatsApp, it's all just this. So whether you're sharing the streaming password in the family chat or trading those late night voice messages that could basically become a podcast, your personal messages. Stay between you, your friends, and your family. No one else. Not even us. WhatsApp. Message privately with everyone. The McDonald's Snack Wrap is back. You brought it back. Ranch snack wrap. Spicy snack wrap. You broke the internet for a snack. Snack wrap is back.

We're back with Shark Ninja CEO Mark Barokas. For the break, we dug really deep into the company's product development process and Mark's philosophy around investing in new categories and how those types of decisions get made at a company that moves as fast and in as many directions as Shark Ninja.

But now it's time to get to the big topic at hand, grilling, and what it means for a company best known for air fryers and vacuum cleaners to try and compete with some of the most beloved brands in all of home appliances.

All right, let's put all this into practice and let's talk about grills. I love talking about grills. Can you tell I'm eager to do it? This is one of my favorite episodes of the year to talk about the grill industry. You've laid out a lot of frameworks here, right? You've said we should...

We should have to deserve to be in the market. We need something better. You've laid out not wanting to get away from the core areas of growth. The grill market, ferociously competitive, extremely well served. Lots and lots of innovative companies. It feels to me like the people who are really into grilling like having lots of different kinds of things as opposed to just one thing. I see it in backyards all over my town. If you got one, you're soon to have two.

It's also been disrupted. One of our very first grill company guests was Roger Dahl, who founded Blackstone, the grill company. He's in the middle of buying Weber. He actually couldn't be on this year because there's antitrust. He has to go through FTC review to buy Weber. That's a big disruption, right? He bought the market leader.

Why enter this market? Where's the differentiation? How do you think you get to number one? I think you have to go back to Ninja is the market leader in the kitchen. And we built up a lot of brand equity in... you know, air fryers and ovens and cookware and blenders and coffee makers and all kinds of things in the kitchen. And so three years ago, we decided that it was time for us to go outdoors. We did it.

through developing a product called the Ninja Woodfire Grill. The Ninja Woodfire Grill was a grill, a smoker, and an air fryer. It was all electric. It sat on your tabletop. And we felt like there was a really unserved need. And I'll give you examples of it. People that live in apartments, they can't have propane, okay, but they can't have electric outside. You know, campers. and RVs and boats and things like that and tailgates, you know, that you can just plug in.

We found that people owned a grill, but they weren't going to invest in another smoker. And so we found that people would be interested in buying something that was kind of small that could fit on a tabletop next to their outdoor grill or vice versa. If they owned a smoker. Now they could own a grill. And so we felt like, you know, we saw this in the vacuum cleaner business. You have an upright vacuum. You have a cordless vacuum. You have a robot vacuum. You have a hand vacuum.

And so we went into the market, and in a very short period of time, we took big market share. I mean, we're the number one selling electric outdoor grill right now. We sell a number of different versions of it. We then went into outdoor ovens. And so we've got a really great- Wait, can I just ask again? Sorry, you're just in my wheelhouse. Number one selling electric outdoor grill, that feels like a small part of a huge category. It is, it is. But that's our, I mean, you have to understand like-

you have to enter in a place that the consumer accepts you. And then you have to figure out then what's next. So we go into tabletop grills. We then expand from that into tabletop ovens. OK, and so now we've got this outdoor oven that allows you to cook to 700 degrees and you can roast and you can make pizza in it. And it's, you know, and so so that becomes a nice business for us globally. So then we decide where do we go next?

We're doing great in tabletop. But now, as you said, there's this big market out there, this $5 billion market around large format outdoor cooking products. So we look at it and we put ourselves in the shoes of the consumer and we say, what's the empathy of the consumer? The consumer goes into the Home Depot parking lot. It's Memorial Day weekend and they go to one of the orange aprons and they say, I want to buy a grill.

And the person says to them, well, do you want a grill or do you want a smoker or do you want a pizza oven or do you want a roaster or you want a griddle? Now that becomes the first problem for the consumer. I got to make a choice. I mean, maybe in your neighborhood, you know, there's multiple grills outside, but this person is saying, I got one to choose from here. What do I do? Do I want a griddle? Do I want a grill? Do I want a pizza oven? Do I want a smoker?

Well, so we started with that and said that to us feels like a really credible problem for somebody to solve. It took us two years. But we developed the world's first grill that's powered by propane, electric, and a cyclonic fan. Three things. I mean, there's incredible patents and incredible technology in this product.

Now, if you have those three things, what can you do? You can have incredible temperature control. Now, once I have incredible temperature control and I can move the air and circulate it inside, I can grill. I can smoke. I can be a fully functional pizza oven. I can griddle and I can roast. The world's first product that's able to do all of those under one hood. And we called it the Ninja Flex Flame.

And so we envisioned a world where consumer now goes into the Home Depot parking lot and ask that same question to the orange apron person. And the orange apron person responded, well, sir or ma'am. You know, you could either have a grill or a smoker or Ninja's got something that does it all. Now, not just something that does it all and does everything so-so. I mean, grills.

you know, like an incredibly professional $1,000 plus griller, smokes, you know, as well as a $1,000 smoker, you know, does Neapolitan pizza in a few minutes. griddles and has incredible even cooking performance roasts. And so we came out with that product a couple of months ago, and you can go online and look at it. I mean, it's a 4.6-star rated product. It's doing great. We launched it with an ad campaign with David Beckham.

And we think this kind of opens up kind of a whole new global opportunity for us. I gotta ask, you said cyclonic fan. There's that fan again. This feels like core technology for you guys. Is it related to the shark fans? Well, sure. I mean, you know, we understand airflow and we understand motors and we understand putting electronics. I mean, think about your grill 10 years ago, right? You put a bunch of charcoal into a pot.

and you lit it up and it had some flame and it grilled for you. I mean, this product's got a cyclonic fan. It's got an amazing amount of electronics in it to have precision temperature control. It has wood fire pellets that allows you to be able to smoke. It has electrical power. You know, it has propane power. So again, I mean, it's what would a team of 1,300 engineers be thinking about if they wanted to build... the absolute most amazing product outdoors.

And if you were not willing to have four different products in your outdoor patio, which, you know, I believe kind of most consumers aren't in a position to be able to do that. So we came out with this product. We launched it at $999. And, you know, we think what this product offers is breakthrough innovation, market-leading performance, great quality at an extraordinary value for what it is that it delivers.

So I apologize, but I've had a lot of grill company CEOs in the show. Literally, I'm telling you, it's one of my favorite episodes of the year. Because all of the problems of the grill industry are the problems that every other company has, but we don't think about that industry in the same way. So I would broadly describe the business models of your competitors in the grill industry as breaking into two camps.

There's Big Green Egg, which wants to sell you a very expensive product that will last for a lifetime that you pass down for generations. They're owned by a family foundation. They're not chasing profits in that way. Totally fascinating. There's some high-end grill companies that also think the same way. Then there's... the everyone else which is like we're gonna put a hunk of metal outside in three years it's gonna rust out and you're gonna buy a new one at 9.99 you can do everything

oh boy, my hunk of metal rusted out and it's going away. That's not a winning proposition. So how do you think about that cycle? Because those are basically the two camps. Are you trying to last forever or are you trying to get replaced on a cadence outside? There's obviously a replacement cycle for the product, but our business is about innovating and putting our products into retirement before their usable life.

It's no different than what Apple does. I mean, when the iPhone 16 comes out and you have an iPhone 14, you don't really need the iPhone 16. I mean, your iPhone 14 is just fine. But there's some technology. It's got three cameras. It's got some other thing in it. There's no difference. I mean, that's what Shark Ninja's model is. I mean, if I relied on replacement cycle...

You know, someone would buy a product from me and they'd come back, you know, four years later to buy the next product. I mean, I want the consumer, you know, to get excited about what we do and say, wow. Air fryers is a great example. We came out with our first air fryer. It was a four-chord air fryer. Did an amazing job air frying your food. We immediately got feedback from consumers that they wanted larger capacity. So we developed a five-quart, a six-quart, a seven-quart air fryer.

We then found out from consumers that they were batch cooking. They were making the chicken tenders and French fries for their kids, and then they were putting in the salmon and the asparagus for them. And we said, wow, well, what if we could develop an air fryer that was a dual... basket that was actually able to cook two things at the same time in two independent baskets. And that became the number one selling air fryer in the market.

We then, shortly after that, found out that, wow, consumers love that concept, but for some consumers, it took up too much counter space. So we took that side-by-side air fryer and we stacked it on top of each other. And we made the world's first stackable air fryer. Now we found out, wow, consumers go home, they prep their lunch and they take it to the office.

or they prep their food in the beginning of the week and they kind of meal prep for the week, what if we could develop an air fryer that fits in the palm of your hand? And it's a product called the Ninja Crispy. And there are consumers now that are taking these glass vessels that you cook in, this healthy cooking glass vessels. They bring them to work. They bring their air fryer pod. And instead of putting their food into a microwave, it's going to make it all soggy.

mushy and they got to eat it for lunch, they're actually air frying at their desks their food and eating it for lunch. They're meal prepping in the beginning of the week and then they're just putting their Ninja Crispy on top of it. That's how we think about the business. I mean, whatever we have developed today in the Ninja Flex Flame, I can tell you that two, three years from now...

We're going to come out with some innovation that's going to be even better, even more exciting, and it will allow the consumer to make a decision. Maybe they've got to take that product and give it to a neighbor or give it to their...

child or, you know, whatever it might be because Ninja or Shark has come out with the next great innovation. I feel compelled to point out that the core mechanical component of an air fryer is a fan. Just saying it. It pops up over and over again in this conversation. You've got a lot of fan technology. It's wild to see how disparately it can be expressed. You've mentioned software a couple of times.

Right. It's in the Flex Flame. It's in a lot of the other products. One of the themes on the show that we've run into over and over again is once you start investing in software, that becomes just an exponentially increasing cost. Right. The servers have to stay up. The apps have to be updated.

to keep releasing new phones. They're going to change the design language of iOS on a whim whenever they want to. Is that all in-house for you? Do you contract that out? Because one of the biggest complaints I see with smart grills, smart appliances... is when I bought this expensive thing, the app broke, and now my grill is useless.

I would say that, you know, about 75% of it is in-house and about 25% of it is out of house. This is an industry and a market that is changing so quickly. I mean, having an app that is a standalone app on your phone. like Waze. That is a Uber. That's very different than having an app that is connected to some sort of hardware device. It's a whole different situation. And so...

We're the first to admit that like we need to bring lots of great minds around this. And so a portion of that is absolutely outsourced. I mean, as we look at. testing and validation as we look at, you know, development ideas, you know, but we do have a great core team internally that is working on that, that works on that with our robot products, that works on that with our outdoor cooking products.

The concept of an app on a product is very interesting. If I go back six years ago, I remember going to trade shows where every single booth in the trade show just commented, app, we have an app. And I remember going down once into one of our engineering labs and there was a blender there. A person handed me their iPhone and they said, here, use the blender.

And I went on the iPhone and I pressed go for the blender to start. And I said, well, our blenders actually just have one button. Like, unless the app can put my bananas and my strawberry and my protein powder. into it while I'm in bed, why do I need an app on this particular product? I mean, I can just fill everything up, I can push a button, and there are sensors that know when the blending...

is stopping. We have a technology called BlendSense that's able to do that. So I think with apps, the really important thing to understand is when... Is the app a vanity exercise versus when is the app really bringing true value to the consumer and unlocking something in the product that they wouldn't be able to do if the app didn't exist? I think that's the case with robots. I think there's a case.

to be able to make in that with outdoor cooking. But as you said, it is very complex putting together an app together with some sort of hardware and making sure that all of those pieces connect for every... house that's out there, every router that's out there, you know, every consumer that's using it. And so we've got to work with both in-house and out-of-house people to help us do that.

How do you think about that cost? You know, there's the consumer experience of I bought a grill five years ago. They never updated the app. Some of my features went away because they didn't, you know, iOS changed. That's one set of the experiences. From the company perspective, what I hear so often is.

There's no recurring revenue model for this product that supports ongoing development of this app, right? So you brought up Uber, for example. Uber's business is that app. They spend a lot of money developing that app. Do you have that kind of model in place where you say, OK, here's the ongoing support cost of the Flex Flame Grill that will make sure we deliver updates to the app? It'd be interesting for you to know. I mean, we update our robot app nearly every single month.

And that is going out to all of the devices that are out there. It could be a product that somebody bought five years ago. There's constant, constant updates. I mean, as we're looking at data... from the apps, you know, as we're getting testing feedback, as we're getting returns information, as we're getting customer service questions that are coming in. I mean, these could be bug fixes.

These could be new feature functionality that we're adding into it. But you're not charging like subscription revenue. No, no. So that's just cost. So how do you think about that cost versus the margin of the product at the one-time sale? We look at it as it's all about positively impacting. the consumer. I mean, I need the consumer to have a great experience so that they come back and when we go into the next category...

They say, wow, you know, I had a great experience with this Sharker Ninja product. You know, I'm willing to try them in the next category. You know, you brought up, you know, other outdoor cooking companies. You brought up other companies. You have to understand most companies have a business model where they want to sell you a product and then they want to sell you another product four years later when it comes to the replacement cycle. I want to sell you two products a year.

I want to sell you two products a year. I want to sell you a cordless blender. I want to sell you a espresso machine. I want to sell you a LED infrared face mask. I want to sell you... If you have a bad experience with one of our products... I'm going to lose that whole recurring revenue stream from you as the consumer.

you know, that I want, I've been doing this for 17 years. I mean, I want to do this for another 20 years. And so over the course of that period of time, there's a finite number of consumers and every day. As a business, you're either gaining loyal consumers or you're losing frustrated consumers. And so it's our job, I mean, when you think about, when you say, well, what's the ROI on that? What's the ROI on happiness? The ROI on happiness for Shark Ninja?

is infinite. I mean, that's how we've built our business. So it's not even a question as to whether we'll go and do it. You know, the answer is we have to do it. I mean, we have to make sure that our consumers are happy.

You know, it's really interesting about this conversation. There's two themes. One is fans are everywhere. And the other one is how much you're willing to talk about costs, things that cost money against growth. You're constantly expanding. You're launching 25 new products a year. It feels like you see growth as the engine that justifies.

whatever costs come about. Do you see an end to that growth? Hopefully not. Sure. I'm just asking, because at some point you're going to run into a category problem where you're Apple and you have to make a car. But look, I mean, you know, I've been told that now for 15 years. You know, Mark, you have a $500 million business. Could it get any bigger? And, you know, you have a $700 million that couldn't get any bigger. And so, look, what I would say is, I mean.

If you've worked at a company that's growing 1% or declining 2%, it's tough. Inflation's going up 3% or 4%. There's not much money at that point to invest and to innovate and to reinvent yourself and all of those things. And we're trying to disrupt ourselves. I mean, we were known as Shark the Steam Mop Company 17 years ago, and then we're Shark the Vacuum Company. And now, if you speak to a college person, they think we're Shark the Beauty Company.

We're constantly reinventing ourselves. And so it's not even so much what growth allows you to be able to do is it allows you to be able to invest. But investing alone is not enough. I mean, it's not enough just to have money. to invest, it's are you willing to disrupt yourself? Are you willing to take your old business model, rip it up, throw it away, and start new again? Are you willing to pivot?

quickly? Are you willing to say that, you know, I'm going down a path that likely is not going to work or that someone else is going to catch up to me? I mean, we go into these categories. I'll invite you after we're done with this. And it does apply to your, you know, air. model. We have a product called the Shark Turbo Blade. It is an indoor fan that has 350 million impressions on social media right now.

It is going viral on social media. And when you look at that, you say to yourself, well, Mark, it's a fan. No, it solves an incredible consumer problem, you know, that the consumer didn't even know that they had. but it also creates a category of one. We're not in the fan business. We're in the turbo blade business. We're in the comfort business. You know, I mean, so again, it's just growth is the pathway, but... It's the mindset and it's the culture that allows you to be able to say,

I'm willing to rip it all up and start over again because we've got to create a definable competitive advantage. There's just something really interesting and honestly refreshing about the idea that you see essentially infinite new categories that will allow you to...

invest in some of the costs where I see a lot of your competitors saying, we actually, to preserve our margins, we have to stop investing in a bunch of stuff because Chinese companies are coming or Amazon is available. Amazon at this point is chat GPT for products, right? You type something in.

5,000 suppliers will show up to sell you variations on the same product. The other piece of this, which I think is really interesting, and I want to make sure we spend some time on it here at the end, is how you think about marketing. How you think about the brand, right? The brand is getting more upscale.

We have a shark vacuum from 1,000 years ago, and I know that the plastics you're using now are much higher quality than the one we have that we bought 1,000 years ago. You're moving up, and a lot of how you're moving up is marketing on social media.

Adweek had a story. You guys are selling $700 million a year. That's 11% of your sales. And all of it is going to creators and product placement. I look at that and I say, oh, the whole ad industry, which as we're speaking is it can in France right now, talking about the future of the ad industry.

I look at your spend and I say, oh, this is the meteorite, right? This is going to hit the earth and everything's going to change. You're at the bleeding edge of it. Why make that bet? How do you think that bet is going? And where do you think it goes from here? Let's go back 16 years ago. At that time, 100% of our ad spending was on what were called long-form infomercials. 30-minute...

infomercials. My partner would go on TV. We would run demonstrations. He and I would develop demo ideas that we would do. Now, why? Because we didn't have any money at the time, you know, and so we went on TV and a certain amount of the sales came to us directly that paid for the advertising expense. But a large portion of the sales went and got sold at retail outlets. And so...

Every brand, every company has to kind of find their white space. So let's start with that. Like when people would say to me, like, you know, well, I mean, you're on infomercials. Well, OK, but that was our way of expressing to the consumer. you know, what was unique or different about our products and the problems that we were solving. And it helped build our brands. I want to go back to the point we talked about, about the online reviews back in 2008.

When I was a kid growing up in New York in the 80s, there was a store called Sims and they would say the educated consumer is our best customer. Well, in 1985, there were not many educated consumers. OK, if you had a problem with a product, you returned it to the store and you told your mom or your dad or your friend, you know, hey, I wouldn't buy this product. There was no forum to be able to get the information out. So when the online reviews started.

That became a great selling vehicle for us, a great referral vehicle for us. It evolved as you got into 2014, 2015 into Facebook. You'd have these big Facebook group chats. You'd have 30,000 people, 40,000 people exchanging recipes and ideas. And then right before COVID, during COVID, it really started evolving into social media.

Instagram and TikTok. And today it's so much more than that. I mean, we're going to spend, you know, the platform that we're going to have the highest increase on this year will likely be Reddit. We're spending more on Pinterest. We're spending more on YouTube. So it's these ways for consumers and creators to express themselves and for others, for consumers to be able to get information about the product. And so if you go back a number of years ago,

and you were advertising, you created one message, you created one ad, you ran that one ad at, you know, nine o'clock at night on NBC. And the only people that saw it were the people that were watching NBC at nine o'clock at night. Go into the comments section on some of our new products that we launch and go look at them. When is this product coming to Portugal? When's the product coming to Norway? We went and did a really interesting exercise. We went and mapped.

How does the consumer consume social media all around the world? And you'd be interested to know that, you know, they're not just consuming it in English in the United States and Canada and the UK and Australia. They're predominantly consuming it in English in the Netherlands, in Poland, in the Nordics, in the Middle East.

And so one of the things that's really driven kind of the global, you know, expansion of our business is that, you know, there's already pent up demand for our products even before we even bring the product into a market. So I'll give you an interesting. example. I mean, we were launching our Ninja Slushy in Norway. It got wind on social media that one of the major retailers was going to have Ninja Slushy product. And there was a line. The temperature outside was five degrees Fahrenheit.

there were 400 people lined up outside of the store to buy the Ninja Slushie. And that all came from just this social media awareness that kind of has no borders and just permeates all around the world. One of the things I think about a lot in the creator economy is there's the organic demand, which you're describing, right? People see things, the content can travel anywhere with regard to borders. And then there's your spend.

You are spending with creators and influencers. That is a huge part of the market. It is a growing part of the market. There's a ton of excitement there. There's a ton of money there. I see a supply and demand problem in the influencer economy. I think the creator branded content economy is headed towards a crash just because of supply and demand.

Right. There's an infinite supply of creators every day and more creators are coming onto these platforms. There's AI, which I want to talk about for one second here at the end, that's creating more and more content. There's only so many people with only so many minutes. And you can see the supply is just going to outstrip demand over time. Are you seeing your rates that you're paying influencers go up or down in response to this?

I look at it, I think, a little bit differently. And I think what the crash that's going to happen is that those that are not creating compelling content, there's going to be a big shakeout. Okay. And I think that if you're able to build super compelling content, you become very valuable to brands, you know, very valuable to be able to market with. I think there are a lot of people out there that are mailing it in on their content and they're not.

investing in themselves and they're not evolving and they're not continuously getting better. I mean, you as a creator might be able to do something for a brand and you say, hey, I did this post. But like, I think you really need to be looking at, you know, what's the lifetime value that I could be doing with this brand? Not that one post.

But what about if I was working with a company that was coming out with 25 new products a year, and they called me up every year to do five of their products and to work with them on five of their products? I wouldn't be thinking anymore about the short-term impact of how do I just get through that one post and move on to something else?

And I think that is what is going to evolve and change over the course of the next year, over the course of the next two years, that I think as the metrics and the data become much more, much faster. you know, much more transparent. I think we already have dashboards in the company that we're immediately able to look at a person and just scorecard them.

And immediately be able to say, hey, these are creators that we don't want to work with anymore. These are creators that we want to work with tremendously, you know, moving forward. I don't think that that was something that was... looked at as closely or managed as effectively as there was this kind of big swoop up. I think you will see that over the next 18 months change considerably. And I think you will find that...

the best creators really rise to the top and there's a real bifurcation of the market. When you look at those scorecards and those dashboards, what are the metrics that you're measuring to figure out who's worth working with and who's worth dropping?

We're looking at engagement metrics. I mean, you know, we're not just looking at views. I mean, we're looking at engagement metrics. We're looking at, you know, likes and shares and comments, and we're looking at the types of comments. You know, are they commenting about something that you did?

that got them excited about the product or are they commenting about something that maybe you wore? They like what you wore in the spot. So I think that there are tools now and there's metrics now that have allowed us to get... so much more educated. I mean, if I go back, I remember, you know, even 24 months ago, you know, you'd get excited about, hey, we have a post that had 500,000 views.

That 500,000 views is not the answer anymore. It's drilling down now and really understanding, did a cohort of people engage with that content? Did they get excited about that product? what did they do once they saw it? Did they just scroll to the next one or did it elicit some type of reaction or feedback from them? I think that the world is getting much, much more educated and intelligent about that.

So I want to read you this quote from Mark Zuckerberg because what you're describing is a trend I see everywhere, which is this industry is professionalizing. And there's going to be some winners. There's going to be some losers. And it's really interesting to me that your background is in infomercials because I see all of these social platforms as turning into marketing channels.

And you're describing the individual creator as something like a new generation ad agency or a marketing firm, where they're independent marketing agencies. They partner with you for a long duration, and they think of you as a client, and they're trying to deliver results to you. And you could see how that would play out, but for AI. Because the platforms see that money, they see your $700 million, and they want it for themselves.

And I say this as explicitly as I'm saying it because I have Mark Zuckerberg here. He said this on stage at various conferences. He said it to my friend Ben Thompson recently interviewed. I'm just going to read you the quote. This is Mark Zuckerberg.

In general, we're going to get to a point where you're a business. You come to us. You tell us what your objective is. You connect your bank account. You don't need any creative. You don't need any targeting demographics. You don't need any measurement except read the results we spit out. That's a redefinition of the.

category of advertising. So he's saying, you, Mark, you're going to show up and you're going to say, I just need to sell some grills. And Meta is going to AI generate some advertising, put it in their feeds and deliver you sales. How do you feel about that? I think the professionalizing piece is spot on. I think that the multi-year journey that we go on to develop a product and the insights that we get.

you know, by having the product in a thousand consumer homes and all of this feedback that we get prior to launching the product that informs our creative and really allows us to be able to... kind of hone the messaging and the testing. I think there's a model out there that people say, you know what? Forget all that. Just put out 10,000 pieces of content and see what hits and, you know, the ones that hit amplify and the ones that don't hit, you know, go away.

I still believe that with what we do and the knowledge by which we gain and the testing by which we do, there is a need for... great content, you know, a real understanding of the product, a real understanding of how the product is going to delight the consumer in their home. I think there's a role that kind of, I call it kind of like fishing with a big net.

you know, and throwing the net out there. But I also think that it's not going to be as overly simple as the way it's described. I think that's the other pressure on rates, though. I can feel that coming, right? The platforms will find a way to take money out of the rates that the creators are getting paid. Like Instagram, for example, today, Instagram creators make no money from Instagram. Their money is almost entirely from brand sponsorships and other integrated marketing.

Over time, Meta, I think, wants some of that money. How do you feel about the rates you're paying to your best creators now? And do you think they're going to go up or do you think they're going to go down? You know, it goes back to your, you know, supply-demand conversation. And it goes back to, you know, the metrics piece.

I think the people that are doing amazing, compelling content, I think they're probably going to be more valuable. And I think they're probably going to be worth more. And conversely. I think there's going to be a whole group of people that you were overpaying for. And now you're going to realize that you were overpaying. And you're either going to have to renegotiate those prices down or decide, hey, I mean, it's not a fit. I mean, no different than the way you look at TV networks.

I mean, there's TV networks that deliver you the viewership that you want, you know, at a certain price. And there's TV networks that, you know, don't deliver it. And so again, I... I think this is great for the industry. I think this is great for content creators. I mean, people have said to me, Mark, well, what happens if TikTok gets banned? The content creator community is here to stay.

OK, this is they will find other platforms. They will go to other places. They will find ways to express, you know, their creativity and what they're doing. They're providing great insight to people. I mean, I got to tell you something. If I when I go to a city. One of the first things I do is I go on TikTok and I look at, you know, what are the best food places in that city? You know, I mean, there's amazing amounts of content and information that is so useful. So I think in the end.

you know, this is going to become great for the content creator community, but it is going to have a situation where, you know, those that are doing great work are going to get paid more and those that aren't, you know, we're going to have to work to reinvent themselves.

Can I ask you kind of an existential question? I know why it's great for businesses that are trying to sell things. I can see that pretty clearly. I know why it's great for the creators. They're making a lot of money making essentially infomercials. I don't know if it's great for the people who consume media. to open all the different apps on their phone that are taking more and more time and kind of be awash in a sea of paid sponsored marketing messages.

Because ultimately, these platforms are just becoming marketing channels, right? That is the money that drives the entire content ecosystem on every single one of these platforms. How do you think about that? I mean, you are a consumer of media as well. How do you experience that? We want to be relevant wherever the consumer is engaging and consuming content. We want to be relevant wherever the consumer is choosing to shop.

I think that it is the error of any consumer products company to not go where the consumer is going. I think if you head off to a different place where the consumer is not. And you just hope that the consumer will go there. I understand about the company's needs and why you're there. I'm asking about you as a consumer of media when you open TikTok or Instagram and it's kind of all marketing messages.

Me as a consumer, I mean, I'm consuming content in lots of different ways. I mean, I have my, you know, Apple News Feed, you know, that I open up in the morning. You know, I have my, you know, Bloomberg subscription, you know, that I open up in the morning. I mean. I think it's about, I've got options. I don't have to open up Instagram. I don't have to open up TikTok. I can open it up just for the purposeful things that I want to open it up for, but there are lots of other ways.

that I can get information. So I think it's really up to the consumer to make that decision. I mean, I'll give you a great example. I mean... You know, we just put the Shark Ninja brand on Brad Pitt's race car in the Formula One movie. We never thought about investing in Formula One in the past. We never thought of investing in movies. in the past. But, you know, we were just at the premiere on Monday and, you know, it's incredible placement that Shark Ninja has.

You know, social media is one place. I mean, you know, the point is, is that how are we part of culture? Culture could be experiential events. Culture could be movies. Culture could be TV shows. Culture could be outdoor, out of home. You know, listen, I'm fascinated by what... LVMH is done on the corner of Fifth Avenue and 57th Street. I mean, they're stores under construction.

They cover the entire store in a Louis Vuitton suitcase. And you've got people on every corner that are snapping content there in front of it. So again, I think it's about...

being relevant where the consumer chooses to ingest content. We got to add a Verge subscription to your list of subscriptions that you have. And it's very important to me that we throw that in there. You've given me so much time. This has been great. Last question. You've got all these new products every year.

As you look at over the next 12 months, what's the one that we should all be looking at for? Wow. I mean, you're going to get me in trouble if I tell you what's the one. That's the idea. Right at the end, you get in trouble. I mean. You know, I'm really excited about our beauty business. I think the roadmap that we have coming out in hair and skin, I have two 20-something-year-old daughters. That's just a category that, like for me, I have a lot of passion for.

My wife is a beauty enthusiast. So I'm really excited about what we're doing in beauty. On the ninja side, look, I'm really excited by what we're doing in the kitchen to bring things to consumers. that just makes their homes and their lives better. I mean, I think what we're doing with the Lux Cafe, you know, is incredible. I mean, for the consumer to be able to get...

drip coffee and iced coffee and espresso and, you know, to be able to froth hot milk and cold milk and dairy milk and non-dairy milk. I think we're doing that in coffee. I think we're doing that in slushies. I think we're doing that in ice cream. I think we're doing that in cooking.

So, you know, I'm just so excited. I mean, the roadmap of ideas that we have in Ninja, you know, is really fulfilling on this mission of positively impacting people's lives in every day and every home around the world. Mark, this has been great. We're going to have to get you back. There's a lot of stuff I didn't get to talk about that I really want to talk to you about. You're going to have to come back soon, maybe before the next Squirrel comes out. Great. Look forward to it. Maybe fan season.

I'm telling you, once you start seeing fans, fans are everywhere. Great. Thanks so much. I'd like to thank Mark for joining Decoder on our annual grill episode. And thank you for listening. I hope you enjoyed it as much as I did.

If you'd like to let us know what you thought about this episode or really anything else at all, drop us a line. You can email us at decoder at theverge.com. We really do read all the emails. You can also hit me up directly on threads and blue sky. And we have a TikTok and an Instagram. Check them out. They're at decoder pod. They're a lot of fun. If you like decoder, please share with your friends.

and subscribe wherever you get podcasts. Decoder is a production of The Verge and part of the Vox Media Podcast Network. Our producers are Kate Cox and Nick Stat. Our editor is Ursa Wright. The Decoder music is by Breakmaster Cylinder. We'll see you next time.