What the healthcare industry can learn from a tea brand

Don Vultaggio is a billionaire. In the 90s he created Arizona Beverages, which currently, according to Forbes, generates annual revenue of US4 billion. According to the same source, its founder is worth US6.6 billion.

But what do Don Vultaggio and Arizona Beverages iced teas have to do with the healthcare sector?

AB’s founder has a realistic approach to business, he believes that waste must be avoided, regardless of the size of the company or the profits generated.
He believes in the logic of “give back”, which is why he has been able to keep the price of the 23oz cans of iced tea below 1 dollar, literally at 99 cents, since 1992, when the company was founded

For this, innovation plays a fundamental role. In addition to reducing losses and money waste, they increased efficiency, increased production speed, switched from trucks to trains, or changed deliveries. Doing so requires constant innovation to find new ways to reduce costs, from increasing production speeds to making late-night deliveries. According to Vultaggio, the consumer is the one who pays the bill when money is thrown out the window.

Additional expenses never jeopardize the quality of the product. For example, when they redesigned the lids of their cans, they aimed to reduce manufacturing costs. The flavor remained. Vultaggio guarantees this, he’s the one who tastes and approves each drink launched by Arizona before going to the market.

Decision-making at Arizona Beverages is made at all levels. The CEO dedicates a good part of his time to talking to the different people from sectors of the company. The founder and leader of the company himself collects data, collects opinions and collects suggestions. Each person is a fundamental part of this well oiled machine and they make it function efficiently. By identifying an idea that can reduce the cost of time, money or effort, it is possible to create a solution. Good ideas emerge from where obstacles are observed.

In its most recent factory, which cost 300 million dollars, nothing was forgotten. The facilities were created for a family atmosphere, providing a welcoming environment that generates satisfaction and motivation for those who work there. But the New York billionaire didn’t stop there. The decoration was not created by an interior designer or architect, it was the workers themselves. Bringing together the decoration proposals, the final result was a mix of murals, Disney-like areas, old cars and plants. A factory that could be an art gallery.

The example comes from the top. Employees follow the CEO’s leadership, so Vultaggio often demonstrates what he wants. If he can do it, any employee can too.

Innovation cannot stop. If Vultaggio believes that the recipe is just fine like it is, if he does not research new flavors or can decoration proposals, if he does not launch brand merchandising or if he is not attentive to consumer tastes or feedback and if he doesn’t react accordingly to changes, the risk of failure is greater. The customers are the ones who make the business exist and prosper. The market exists and the competition is there, if you fail to present the right product, bankruptcy is right around the corner.

This importance that Vultaggio gives to the brand’s customers is visible in the price that has remained unchanged for more than three decades. A successful, debt-free, and everything-giving company doesn’t need price increases to increase profits. “Why have people who are having a hard time paying their rent have to pay more for our drink?”, he asked, announcing that he does not intend to raise the price of iced tea in the near future.

The can was designed by Vultaggio’s wife, his sons are creation and marketing directors. Tea cans can be found in supermarkets and convenience stores, for example, and are identifiable by their vibrant colors, turquoise, pink and yellow.

Competition from giants like Coca-Cola and Pepsi is abysmal, so the way to gain market share is to innovate, be creative and do things differently. Savings on traditional marketing campaigns represent an ammount that does not have to be paid through sales.

And he would rather sell 4 products for 1 dollar instead of 1 product for 4 dollars.

Arizona’s iced tea strategy is centuries-old and relies on word of mouth. A satisfied customer becomes a fan. And the best marketing is done by the fans.

Like the ice tea, health care is (or should be) focused on the patients. By providing quality care, by making sure innovation is well applied to optimize processes, to reduce money waste and losses, using technology to help professionals spending their time in tasks that can’t be done by machines, motivating and valuing every single person in the company, then healthcare companies and professionals will become their patients’ beloved brands. And they will be proudly talking about them with the highest praises.

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