Credit: NBC
Highlights
- Scrub Daddy made its way to Shark in one of its earliest seasons.
- It was originally created to remove oil and grease from the hands of car washers.
- Starting from nowhere, the business has now earned over $900 million in lifetime sales.
With hundreds of pitches being brought to the show every season, there are some ‘underdog’ Shark Tank products that manage to leave a lasting impression on the viewers and investors. Scrub Daddy is one such product, which no one expected to become this huge.
A kitchen cleansing sponge that was presented to investors in its fourth season has transformed itself into a million-dollar company. Here is all you need to know about the untold success of Scrub Daddy.
Scrub Daddy Pitch
Aaron Krause, a budding entrepreneur, went to the judges, pitching for his unique, smiley-shaped kitchen scrubbing sponge. Seeking a $100K investment at 10% equity, he explained how the sponge could change its size as per different water temperatures and cleanse without any harmful chemicals.
Going ahead, he gave a background into how he came up with this business idea. Initially working for an automobile market, he first used Scrub Daddy to clean the dirty grease from his hands. Happy with the results, he thought of using the sponge as a kitchen cleaning tool.
Emphasizing the product’s unique ability to change its size as per water temperature, he presented Scrub Daddy as a staple household item.
Aaron ended his pitch, revealing that he had made more than $100K via sales and that he was looking ahead to get his products on the shelves of 3000 retail outlets.
Scrub Daddy Negotiation
Although the pitch appeared to be an infomercial, Robert was not impressed. He felt that it would not go well with the retail market. So, he stepped out of the deal. Mark, too, steered clear of the product as he felt it would earn mainly on QVC.
Daymond did make an offer of $50K for 15% equity but he laid a condition that Lori joined him for the remaining $50K. Lori, though, wasn’t interested in the collaboration; she made her solo offer at $100K for 30% equity.
Kevin then proposed $100K for a royalty at 50 cents per unit. Once he recouped the money, the royalty amount would come down to 10 cents for each unit.
Scrub Daddy Shark Tank Deal
Once Lori refused to join hands, Daymond stepped out of the deal. Kevin was ready to bring down his loyalty to 7.5 cents per unit of the business. But knowing the dominant presence of Lori in the QVC and retail space, Aaron made the smart move of choosing her.
The deal with Lori was finalized for $100K at 20% equity.
Scrub Daddy Success Story
Ever since its appearance on the hit ABC show, the Scrub Daddy Shark Tank episode has risen as a classic success story. Soon after its episode aired in 2012, it garnered bulk orders, which led to a massive $75 million sales by 2016.
Scrub Daddy was included in a Shark Tank update segment in the ninth season due to its substantially growing popularity. The sales revealed during that time were more than $150 million.
Its success can further be ascertained by the fact that Scrub Daddy was one of the few products that was listed in the ‘Greatest of All Time Special’ by 2020. By making a massive $268 million in sales, it was second only to Bombas.
The pandemic also couldn’t stop its success ride, and they were the favorite retail pick of consumers with every passing day. Motivated by this, Scrub Daddy introduced its newest ‘Halloween-themed sponges’ in 2022.
The most recent update about Scrub Daddy is that its lifetime sales have reached up to $926 million. Apart from this, to expand global distribution, the company signed a significant deal with Unilever. In March 20224, it hired JP Morgan Chase to maximize new sales.
The company has also expanded its employee count to 273, and its 160 products are sold across 257,000 retail outlets.
The Success Contributors
The story of a kitchen-cleaning sponge becoming a million-dollar business might seem shocking in the first place. But dismantling all preconceived notions, here is how Scrub Daddy emerged as a winner and by far Shark Tank’s most profitable product:
Innovation with Vision: Founder Aaron Krause knew that the retail market was already saturated with similar cleaning products. To stand out in the competition, he had to present a compelling feature of the product. He successfully managed to do the same by emphasizing Scrub Daddy’s temperature adjustment quality in his Shark Tank pitch.
Additionally, he knew his product was an ideal fit for the retail world. So, it was best for his company to choose Lori ahead of the other judges. This is because she holds decades of proven experience in the field. Her QVC background was further a cherry on the cake.
First Hand Experiences: Although the Scrub Daddy Shark Tank episode was a hit, Aaron knew that a consumer driven product would succeed only when potential users are satisfied by the actual reviews.
So, Scrub Daddy called upon its customers to post their product reviews on either social media or Amazon. They could also share their unique cleaning experience, which would, in turn, create organic user-generated content. The positive reviews did wonders for the novel brand.
Discounts and Contests: To earn the love of its loyal customers, Scrub Daddy started giving out affiliate codes and discounts, which further amplified their sales.
Moreover, they offered numerous contests and conducted several giveaways via their multiple social media channels, which drove the excitement of both old and new customers.
To Conclude
The Scrub Daddy Shark Tank success story is an ideal example that with innovation and focused vision, even the simplest of products can deliver the most exceptional results. With unique product abilities, strategic marketing techniques, and Lori’s retail prowess, Scrub Daddy has solidified its position as a champion retail product.
Given its current success ride, it won’t be wrong to say that the company will soon evolve into a billion-dollar enterprise.
References
1. Scrub Daddy’s famous sponge was rejected by a Fortune 500 company and forgotten in a box for years. It’s now a $220 million empire, Fortune, Kevin Sanchez Farez
Entrepreneur, auteur, raconteur. Rob Merlino is a blogger and writer who enjoys the Shark Tank TV show and Hot Dogs. A father of five who freelances in a variety of publications, Rob has a stable of websites including Shark Tank Blog, Hot Dog Stories, Rob Merlino.com and more.
Speak Your Mind