Why in the world did Oath Pizza, a startup pizza chain, open their first store 30 miles out to sea, when they are based in Boston?
Sitting at Brant point on a perfect Nantucket day watching all the ships pass from the Lynks to the yachts and of course the Steamship and Hyline ferry's explains why. Nantucket is a great beach head market for startups.
Beach Head Markets:
At some point in an entrepreneur’s journey someone will talk about a beach head market. A beach head market is what market you are going to go after first and establish your presence and once there, with your foot hold, you can expand. I believe the history of this term comes from the military; D-day and probably many other battles.
Picking a beach head market isn’t trivial. Arguably the beach head market you pick could make or break your startup. Picking the wrong one might be hard to recover from when you have limited resources. Because of the investment of resources, there is a lot of thought that goes into picking your beach head, it has to be worth the effort to fight for it, it must be strategic and will allow you to expand and grow once there, it must be one that you have a reasonable chance to capture, and it must be a place you can learn a lot quickly about selling your product and if there is a product-market fit.
Key features of a beach head market:
There are early adopters
Influencers & investors
People with extra income to try new things that are also often at a higher price
A place that allows you to learn quickly about the product market fit of your products to inform a pathway to scale.
Nantucket is the perfect beach head market:
Nantucket has all the key features for a beach head market. In the summer people from around the world come to Nantucket. This is a key strength of Nantucket because you can start to learn where people are from that are most interested in your products/services. For example, would it be best to have a pop-up shop or your first store in Boston, NYC, DC or maybe the west cost? People from all those markets are in Nantucket all summer long. I’m not sure but I am willing to bet that Oath Pizza was thinking about this question and why Nantucket is where they launched their first product.
In addition to getting to know where your customers are from, the Nantucket beach head allows for creating relationships with your customers while they are relaxed and on vacation. People remember their vacation experiences differently than day to day experiences. A new pizza experience/brand is now associated with vacation making it stand out from trying pizza somewhere else.
Many of the customers on Nantucket are influencers and not just one type of influencer. A wide array crossing markets, backgrounds, locations and types. Think about all the festivals on Nantucket over the summer from the Book Festival and Film Festivals to the Yoga Festival and Wine Festival. Then there are all the other events like the Trashion show, that include el president from Bar Stool Sports last year. Nantucket is where investment banks, artist, movie stars, politicians, and athletes all visit together.
Also, important is that the people that visit Nantucket can afford to try high end products or for products before they have been optimized for cost. In addition, insights can be gained about how your products could translate to a less affluent community. Beyond the vacation community Nantucket has a more typical market covering people on visas, college kids on summer jobs, to the year-round community that have kids and families that look more like the socio-economic landscape of most other towns and community of their size
Nantucket has all the key ingredients to make the perfect beach head market for a lot of different products and services. The more I walk through town the more examples I see. Below are my thoughts on why Oath Pizza had their first store on Nantucket. I’m going to see if I can talk with the founders to learn more. Also, a post to come will focus on how some entrepreneurs are leveraging the Nantucket beach head market to provide innovative retail experiences and providing other vendors access to the Nantucket beach head. What do you think, is Nantucket is the perfect beach head market?
Quick Case: Oath Pizza
Why put your first pizza store on Nantucket if you are opening a startup, fast-casual pizza chain that you want to chain/grow to multiple locations? On the face it didn’t make sense to me until I thought about it more. I don’t know the reasoning behind the location decision but I’m guessing they saw that Nantucket was a perfect place to test a pizza brand, which is based on a novel pizza dough and other trade secrets.
Lots of people:
Oath is set up right downtown by the boats and ferries coming into the island so over the course of 3 months the over hundred thousand people who come to Nantucket almost all will see Oath Pizza.
There are only 2-3 pizza shops on island in the summer so there was extra demand that another store could fill without taking away or really competing with the incumbents.
They could accomplish a lot in a 3 month season:
Learning:
Do people like your pizza, will they pay a premium price, where are they from, do hear a Boston accent more or a NYC accent, can we turn out pizza and server the customer at volume to the standard we want (fire test your systems and process), etc.?
They could evaluate if the local year-round community also connected with their brand and products.
Can they make money: If you are a restaurant on Nantucket and can’t make a year’s profit in 3 months then you have a problem.
Customer relationship & branding:
They could build a following and customer relationships that will help launch them in more competitive markets like Boston, where they now have a couple of stores.
With a few Instagram posts form people from around the world and some influencers they could quickly build a brand.
Conclusion:
I don’t know the thinking of Oath Pizza, but I’m pretty sure my review is close. After opening on Nantucket they have raised multiple rounds of funding to expand to Boston, NYC and Washington D.C…. all places many tourist come from to Nantucket. Their press release for funding all talk about Nantucket… a good brand to be associated with: Here is an article on their series A funding round going to try and see if I can get an interview with the founders and see why they picked Nantucket. Hopefully, more to come soon.