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How Liquid Death's 40-year-old founder turned 'the dumbest name' and a Facebook post into a $700 million water brand

CNBC logo CNBC 11/26/2022 Tom Huddleston Jr.
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Let's face it: Water is boring.

Sure, it's essential to your health and few beverages can be more crisp or refreshing, but most bottled water brands are fairly bland and uninspiring — featuring the same interchangeable references to mountains, springs or both.

Over a decade ago, Mike Cessario started wondering if he could change that. What if he could actually make water cool?

That's the relatively simple origin story behind Liquid Death, the ironically named canned water brand that Cessario trademarked in 2017 and officially launched two years later. It might sound like a joke at first — and it kind of was — but there's nothing funny, or boring, about how quickly Liquid Death has become a dominant force in a bottled water market that's worth up to $350 billion globally, according to Pitchbook. 

From its viral social media posts to its Super Bowl commercial, Liquid Death suddenly seemed to be everywhere — along with its cheeky tagline, "Murder your thirst." That social cachet is reflected in the jump in its sales, which were $2.8 million in 2019 and are on track to be $130 million in 2022.

'I didn't think it would be this big'

Cessario, a marketing professional with a background in design and the underground music scene, said he initially thought his water would have only a niche following.

"I didn't think it would be this big," Cessario, 40, told CNBC Make It. "I think one of the most surprising things to everybody with this was how wide the audience really was."

The Liquid Death CEO envisioned the idea catching on with punk-rock musicians looking to stay hydrated during long sets, and any of their straight-edge — in other words, sober — fans looking to keep up while drinking something healthier than alcohol or sugary energy drinks.

Liquid Death now offers a range of still, sparkling and flavored waters. © Provided by CNBC Liquid Death now offers a range of still, sparkling and flavored waters.

Instead, it's found a wide range of fans, from young people who love the brand's "cool" name and design to moms who want their kids to drink something healthy, Cessario said. Liquid Death packages its "mountain water" in a 16.9 fluid ounce "tallboy" can emblazoned with a melting skull logo reminiscent of craft beers or energy drinks such as Monster and Rockstar.

Also taking notice are deep-pocketed investors such as Live Nation Entertainment and Science Ventures and celebrity backers including comedian Whitney Cummings and members of music group Swedish House Mafia. Collectively, investors have pumped about $195 million into Liquid Death, valuing the brand at $700 million, Cessario said.

Liquid Death's meteoric rise in just three years makes the company more than just a clever name — even though Cessario admits that might be his product's biggest selling point. 

"At the end of the day, we're really creating an entertainment company and a water company," he said. "We want to actually entertain people [and] make them laugh in service of a brand. And if you can do that, they're going to love your brand because you're giving them something of value. You're actually making them laugh."

Inspiration at the Warped Tour

The seed of the idea was planted in 2009, Cessario said.

He was living in Denver and watching some friends perform with their band at the Vans Warped Tour music festival. Monster energy drinks were a sponsor on the tour, so the musicians were drinking out of Monster cans, but they'd replaced the energy drink with water to stay hydrated during their sets, he said.

"It started making me think about: Why aren't there more healthy products that still have funny, cool, irreverent branding?" Cessario said. "Because most of the funniest, most memorable, irreverent branding marketing is all for junk food."

Then, in 2014, Cessario was working on a public service ad campaign about the health risks of sugary energy drinks. His idea, he said: "Doing a canned water that was, sort of, just geared as a stunt to poke fun at energy drinks."

The client didn't like it, but Cessario kept tinkering with the concept in his free time. It took him roughly two years to hone the concept, he said, and, most importantly, settle on a name.

Liquid Death had to be 'insanely interesting' to survive

Cessario knew that if he launched his own water brand, he wouldn't have enough money to market it to the masses in traditional ways.

That meant the name, and the brand identity, needed to be the perfect mix of funny, edgy and cool — memorable enough for people to share on their social media feeds, creating free advertising.

"The only way the brand would have a chance at survival is [that] the actual product itself has to be so insanely interesting, where so much of the marketing is baked into the product," he said.

So, Cessario turned to a marketing trick he said his team at Liquid Death still uses today: What's the dumbest possible idea? If you try to think of a smart idea, then your brain is hard-wired to think about successful examples that already exist, he explained.

"You kind of have to trick your brain to come up with a bad idea to truly be thinking in innovative territory," he said. "It works really well because you start thinking, like, 'Oh, what's the dumbest possible name for a super healthy, safest beverage possible? Liquid Death.' Probably the dumbest name."

Once Cessario trademarked the name in 2017, he felt that he was on to something.

"If someone I knew saw that in a store, I'm pretty sure they're going to have to pick that up and be like, 'What is this?'" he said. "And once someone picks something up, you've basically won."

Social media was asking, 'Is this real?'

Cessario hoped Liquid Death could generate its own marketing, but he still needed money to turn it into a real product he could sell.

Initially, potential investors and people in the beverage industry told him that the design for Liquid Death's cans looked too much like beer, which could potentially confuse customers, and that "retailers will never put something on the shelf that says 'Death' on it," he said.

"Nobody was going to just write a check for that idea, because it was so out there," he said.

To prove Liquid Death was a viable brand, Cessario took a 3D rendering of his can design and created a Facebook page in 2018 to make Liquid Death look like a legitimate product. He shot a two-minute commercial starring his wife's actress friend that cost him $1,500, and dipped into his savings to spend another "few thousand dollars in paid media" to promote it.

"Four months in, the video had 3 million views," Cessario said. "The [Facebook] page had almost 80,000 followers, which was more than Aquafina on Facebook at the time."

"We had hundreds of messages and comments from people [saying], 'This is the greatest thing ever. ... Is this real?'" Cessario said.

People contacted the Facebook page to ask where they could buy Liquid Death. Beverage distributors got in touch, looking for a salesperson so they could stock it in stores, Cessario said.

That reaction was enough for investors. After two years of floating the idea to potential backers, Cessario landed $1.6 million in seed funding from Science Ventures in January 2019. Liquid Death started selling cans of water to customers through its website that same month.

How long can the joke last?

Today, Liquid Death has more than 250,000 followers on Facebook and 1.4 million on Instagram.

In 2020, the brand expanded into Whole Foods stores, and it had roughly $10 million in sales for the year. That number jumped to $45 million last year, as chains such as 7-Eleven and Publix joined in.

Earlier this year Liquid Death launched a line of flavored carbonated waters, with irreverent names such as Berry It Alive and Severed Lime.

Now, the brand is sold in more than 60,000 retail locations nationwide, including Kroger and Target, where the cans retail for $1.89 apiece. Liquid Death is Amazon's top-selling still water brand and second-bestselling sparkling water brand.

Cessario said Liquid Death is "definitely" expecting to double its revenue next year, suggesting a total of roughly $260 million in sales in 2023. But how far can a canned water brand based on a good joke go?

Many of the biggest bottled water brands are owned by massive conglomerates, such as The Coca-Cola Company, which owns Dasani and Smartwater, and PepsiCo, which owns Aquafina. Any of them could launch their own irreverent water brand too, but Cessario appears unconcerned by the prospect.

"It's really hard to replicate the marketing," he said. "Really hard. People think it's easy, and you'll see people come out trying to do it and fall completely flat on their face."

Want to earn more and work less? Register for the free CNBC Make It: Your Money virtual event on Dec. 13 at 12 p.m. ET to learn from money masters how you can increase your earning power.

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