‘Thighs Out!’ Chubbies’ Early Leg Up on Logistics Fuels Agility for Men’s Shorts Brand

Like any startup with slim marketing funds, Chubbies knew it needed a creative, not costly, way to build buzz for its retro men’s shorts, said Tom Montgomery, who is co-founder, chief marketing officer and chief technology officer of the brand.

What Chubbies didn’t know, he told CO—, was that its marketing campaign would trigger a frenzy of demand on social media that plunged its young founders into a crash course on product fulfillment. Such “trial by fire” adventures, as Montgomery called them, sped the learning curve in Chubbies’ early days and continues to influence strategy today.

“That was the beginning of us doing our own fulfillment and it got us to $2 million in revenue,” he said. “It was a cool moment. We had to flex on the fly.” Montgomery and his partners were in their mid-20s and their San Francisco apparel company was barely a year old.

Getting a leg up on logistics was not lost on Chubbies, whose skimpy 5.5-inch shorts inseam shows off men’s limbs and inspired the company motto, “Sky's Out, Thighs Out!" With colorful patterns drawn from 1980s nostalgia (think Tom Selleck in the “Magnum, P.I.” TV series), Chubbies shorts are sold online, through major retailers like Nordstrom, plus its 13 company-owned stores.

Chubbies ventured into the celebrity-partnership space in August with a limited-edition line of "Rhettro” swimsuits from country singer Thomas Rhett.

In 2019, the Interactive Advertising Bureau (IAB) named Chubbies among the most important disruptor brands based on “maniacal” customer focus, social connection and use of content as a differentiator. Companies on the IAB 250 Direct Brands to Watch list are hailed as “models of the best practices and trends that are overturning and revolutionizing consumer markets in the U.S.,” according to Randall Rothenberg, CEO of IAB.

Chubbies’ social media content talks not about the brand but instead celebrates what its customers care about most: the weekend. Messaging honors frat-boy humor, beer and the “bro” culture of young men, prompting customers to post their own photos and building community through user-generated content.

Kooziepalooza: Getting ‘likes’ its own way

It was 2012, less than a year after Chubbies was founded, when devotees were raving about the brand on social media platforms like Facebook and Twitter. To capitalize on that momentum and build on the budding community, Montgomery said Chubbies weighed two marketing options: either invest in Facebook advertising to generate “likes” at an estimated cost of $1 each, or devise its own campaign to earn likes while also rewarding consumers with a freebie — a Chubbies beverage koozie with silly sayings like, “Eyes Up, Ladies” and “Your Grampa Definitely Wears Chubbies.”

At half the cost of paid Facebook advertising, the koozies option won out and gave rise to Chubbies’ “Kooziepalooza” campaign. The premise: Consumers who clicked the “Like” and “Share” icons on Chubbies’ Facebook page would receive a koozie if Chubbies’ likes count doubled from 25,000 to 50,000 in one month’s time. (Chubbies’ Facebook likes have since swelled to 1.7 million today; and Instagram followers have grown to 463,000.)

The goal proved conservative. “The final week there was a crazy explosion,” Montgomery recalled, as Chubbies’ koozie-stoked fan base tripled — to 75,000. Now the young company had a problem: how to pack and ship 50,000 koozies, fast. “We’d never done anything to that extent,” he said. “We were still a very small retail business and 50,000 units of anything was an insane amount. It was twice what we anticipated sending out. We were completely pumped.”

Lessons in logistics when ‘they don’t fit’

Koozies were too thick to fit into mailers. A larger mailer would require extra postage but that would blow the economics that made Kooziepalooza cheaper than paid advertising. It’s this “trial by fire” challenge that educated Chubbies about product packaging, innovation and agility, said Montgomery. Through trial and error, he and his co-founders figured out that if they used high-tensile strength mailers and a clever maneuver, a koozie could be compressed, stuffed into a mailer and sealed quickly before air escaped — remaining flat enough to mail with just one postage stamp.

With the packaging dilemma solved, Chubbies next looked to manpower and went to Craigslist to find workers to prepare koozies for shipment. The founders quickly learned how to hire quality staff, Montgomery said.

“The really cool piece of all of this was that a good 50% of hires became our warehouse staff. We realized this is what we are going to need to do as we grow.”

Next challenge: Realization that 50,000 mailers cannot simply be dropped off at a post office. “This was a new world, our first foray in bulk shipping,” Montgomery said. Chubbies would need a third-party logistics (3PL) bulk shipping provider and the founders scrambled to screen vendors and get educated about shipping. Again, fast.

“That set us up to understand the 3P logistics business: ‘What are the expense structures they seek? How can we use that to inform how we think about a partnership with future logistics provider?’” he said. Understanding logistics companies’ economics put Chubbies in a strong position to negotiate a competitive contract, he said.

“It set us up really well from an operational perspective in such a funny, random, haphazard way,” he added. “We understood how we could partner with a 3PL in a lot more intimate way than we otherwise would have.”

All these business gymnastics — figuring out packaging, postal regulations, hiring contract staff and navigating the third-party logistics landscape — played out in a very short period. “We had to do all this in a week, otherwise we’d have people waiting on these koozies too long,” Montgomery said. “It was a good seven to 10 days of panic, but it all worked out.”

Validating the gift-with-purchase strategy

Chubbies had already offered special gifts with purchases, but Kooziepalooza amplified how a “surprise and delight” strategy solidifies the customer relationship, Montgomery said.

“Kooziepalooza showed us the power that gifting has for unifying a community, getting people excited around something that is not mundane, like discounting,” he said.

“Our mission is to treat our customers the way we treat our friends, to engage in the same way,” Montgomery said. “That is the root of community.”

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