The consumer is focused on 'versatility and value': SharkNinja CEO

As consumers become more sparing with their hard earned money, quality and value are key. SharkNinja has that top of mind - and it’s paid off with customers.

SharkNinja’s CEO Mark Barrocas sat down with Yahoo Finance Reporter Brooke DiPalma to discuss the health of the consumer, social media strategy, and more.

Barrocas acknowledges that consumers are becoming more discerning with their spending, saying, "I think the consumer's been under a lot of pressure for the last couple of years... they're making real decisions and trade-offs about where they're gonna spend their hard earned dollars." While SharkNinja’s combination of high quality, high value products have been appealing during this period, Barrocas says “I don’t think we’re immune” to the more discerning consumer.

Still, persistent macro pressure is being felt in names across the retail space. To counter that pressure, Barrocas says SharkNinja is prioritizing research and development along with advertising and marketing. Social media plays a role as well. Users on Tiktok have popularized “hacks” for some of SharkNinja’s products – like using the Ninja Slushie for everything from kid’s orange juice to frozen rose. “What’s great about these products is that the consumer can kind of make it their own,” Barrocas says. “It’s really about the versatility and value of what you’re delivering to the process.

This post was written by Kathleen Welch

Video Transcript

I think the consumer has been under a lot of pressure for the last couple of years, and I think they're very discerning, and I think they are making real decisions and trade offs about where they're going to spend their hard earned dollars.

And for that reason, I think the playbook the Shark Ninja has of market leading performance and high quality at an extraordinary value is something that's really appealing to the consumer in this time.

Yeah, it seems like if you look at your results outdoor grills, ninja ice cream makers, people are still willing to buy it.

Do you think you are immune to the slowdown and how are you thinking about that going into the holiday and into 2025?

I don't think we're immune to it.

I think that we tremendously in R and D. We spend over 7% of our sales in R and D. We invest tremendously in advertising and marketing.

We spend over 11% of sales in marketing.

We have seven times more social media engagement than our nearest competitor.

I think our products are really part of culture, you know, and for a relatively inexpensive price.

We are able to elevate the consumer home and allow them to be able to do things.

And so when you think about a shark or ninja product, you might go out to dinner less, or you might go on a less of a vacation.

But for as you said, 100 and $99 you can have the ninja creamy at home.

Or you could have the shark flex style hair dryer for $299.

So we like to think of ourselves as affordable, accessible innovation.

Yeah, Speaking of the Ninja, Lux Cafe costs $499.

Do you think you have pricing power moving into the end of the year into 2025?

Well, I, I think what it really comes down to is.

Are you delivering extraordinary value?

And I think category to category.

The definition of that might change.

I think the average espresso maker in the United States today sells for almost $800 and all it does is deliver a one shot or two shots of espresso.

The product you mentioned, the Ninja Cafe Lux delivers espresso, ice coffee, cold brew, drip coffee.

We're from Boston, and we go to Dunkin Donuts in the morning and get 18 ounces of drip coffee.

The Lux can deliver that it frosts hot or cold.

It frosts dairy, milk or non dairy milk.

So I think it's really about, you know, the versatility and the value of what you're delivering to the consumer, and I think that that varies.

And I. I think.

Actually, if you look at the reviews of the Ninja Cafe Lux, you'll see that people actually say it's a great value.

Yeah, it really is all about that value proposition.

I. I do want to lean into another trend we're saying, Which is this better for you?

Trend.

It seems like this concept of protein ice cream has really taken off on Tik Tok in particular.

How are you playing into this social media V and And how do you get other products on this platform as well?

Well, I, I think a big piece of it is enabling the consumer to hack our products and to turn them into the things that they want to turn them into.

We have a new product that we just launched called the Ninja Slushy, and it's everything from consumers putting orange juice in for their kids, you know, all the way up to putting Rose wine in and making a froze and everything in between.

And I think what's great about these products is that the consumer can kind of make it their own and decide ultimately how they want to bring it to life and what outputs they want to have of their families.

I do want to broaden things out.

You are a global company.

You do play in China market as well.

How is the consumer responding there?

And are they still willing to splurge on these items?

Or are you seeing a slow down there?

Well, our our our business or international business is mainly focused in Europe and Latin America.

Uh, we're growing in both of those markets considerably.

I mean, we're we've had low market share.

We've just gotten into many of these markets over the last 24 months and we're seeing a lot of excitement.

I mean, we think that our products are right for the consumer there.

We're investing a lot in advertising.

We're getting a lot more retailer placement in many of those markets.

So, overall We think there's a lot of white space in these international markets for us.

How are you thinking about potential tariffs ahead of a trump administration?

We think we're really well set up for whoever wins the election.

Come November.

We've been diversifying our supply chain outside of China for the last five years.

There are tariffs in place today.

The 301 tariffs.

They really have not impacted this much.

The majority of that product is able to be made today outside of China.

So we're continuing to move our supply base and diversify our supply base.

We intend to have all of our US production made outside of China by the end of 2025.

So regardless of who wins, you know, we think we're we're well positioned in a, you know, global environment.

I wanna take a look heading into the holiday into 2025 once again, will you play into promotions into value seeking behaviour that we're seeing among consumers right now?

Fortunately for us, we drive a big proportion of our business at full price.

Now, that's not to say we, of course, participate in all of the major events and all of the big shopping periods.

Um, so, yeah.

I mean, we do intend the market this holiday season to be quite promotional.

However, for brands in our business, we're not expecting promotions to be up over prior year.

We're expecting them to be about flat to prior year and last question here quickly.

What are some of the biggest challenges that consumers are up against right now, when it comes to your consumer who seems to be willing to splurge on the blow dryers and the ninja creamy and so on?

Well, look, I mean, they have to make trade offs and they have to make decisions and they have to do their research before.

I mean, we think that a Shark Ninja consumer is an educated consumer.

I mean, as somebody who's done their research, we're not the highest priced products in the market.

We're not the lowest priced products, but I think we move the opening price consumer up into our brands.

But we're also the brand of choice for premium consumers.

And so I think if we can continue on this model of great value, great quality, great performance, you know, bringing exciting things to the consumer, I think they'll respond