Solo Brands, maker of Solo Stove, Chubbies, Oru Kayak, Isle and other brands, has announced it is changing CEOs in the wake of major marketing investments the company made, including a viral Snoop Dogg marketing campaign for Solo Stove, that the company said haven’t resulted in a substantial revenue increase.
Solo announced the appointment of former Vista Outdoor CEO Christopher Metz as its new president, chief executive officer, and director of the board effective Jan. 15. Metz succeeds John Merris, who will “mutually separate” from the company as its president, CEO, and director at the same time.
This follows Solo dominating the news cycle at the end of last year with a viral marketing campaign where rapper Snoop Dogg cryptically announced he was “giving up smoke,” sending the internet into a frenzy, only to later reveal it was an ad for Solo’s smokeless fire pits.
At the time, the Snoop marketing campaign was seen as a huge success for Solo. Ad Age ranked the collaboration #18 on its list of the 40 best ads of 2023. Merris said in the days after the ad dropped they gained some 60,000 new followers on social media.
Solo also made a big spend to enter a float in the Macy’s Thanksgiving Day Parade this year.
Underwhelming Sales Lift
However, according to Interim CFO Andrea Tarbox’s statement in the release announcing Metz as CEO, the marketing campaigns have not resulted in an increase in revenue for the company.
“While our unique marketing campaigns raised brand awareness of Solo Stove to an expanded and new audience of consumers, it did not lead to the sales lift that we had planned, which, combined with the increased marketing investments, negatively impacted our EBITDA,” Tarbox said. “We believe there is a significant opportunity for us to build awareness and that these new campaigns will expand our reach and benefit our brands over the long term.”
In response, Solo has subsequently revised its guidance for 2023. Revenue for the year is expected to be between $490 million and $500 million compared to its previous guidance of $520 million to $540 million.
Adjusted EBITDA margin is expected to be in the range of 14% to 15% compared to previous guidance of 17% to 18%.
“Our fourth quarter results came in below expectations as we experienced softer-than-anticipated sales in our direct channel,” Tarbox said.
Incoming CEO Metz has more than 25 years of experience leading consumer and durable goods companies, according to a release.
He most recently was CEO of Vista Outdoor for five and a half years, where he repositioned and transformed the company, according to Solo.
Under his leadership, Vista grew revenue and profits, while deleveraging the company’s balance sheet through record cashflow generation, Solo said in a release. Metz also drove the transformation of Vista through organic growth, direct-to-consumer initiatives, strategic acquisitions, and capital deployment.
“Chris is known for building high performing teams, driving growth and transforming companies. His experience across leading outdoor products companies, including Vista Outdoor, makes him the perfect leader for Solo Brands’ future,” said Matt Hamilton, chairman of Solo Brands’ board of directors, in a release. “Our board is confident that Chris is the right person to grow shareholder value.”
Merris told The Daily he didn’t have much to say except how grateful he was for his team and board of directors for an incredible five years.
“I believe the best is yet to come for Solo and can’t wait to watch this next chapter unfold under Chris’ leadership,” he said.
Bart Schaneman can be reached at email@example.com.