CPG News & Insights

Oatmilk Everything and the Pursuit of the Gen-Z Consumer: CPG News, Week of Aug 31-Sept 4

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September 4, 2020
by Veronica Drake
3 minutes

As summer winds down and autumn quickly approaches, the CPG world continues to up its game week after week. Stay in the loop with the week’s rundown of the need-to-know news that matters now.

All Eyes on Oatmilk

Frozen novelty brand Chloe’s Pops is bringing oatmilk to dessert—and it’s a hit. The brand, which began as a fruit pops line back in 2017, says this move has been years in the making. Initially experimenting with coconut milk as a possible non-dairy base, they settled on oatmilk because of its neutrality and what founder Chloe Epstein describes as “a clean overall taste that works well with other flavors.” 

And the decision comes with some momentum behind it: Since first gaining popularity a few years ago, oatmilk has quickly become a consumer favorite.

This year alone has had some shining moments for the oatmilk market, as Nielsen reports 289% YOY growth from March to June.

Meanwhile, oatmilk-centric brands like Oatsome and Oatly have taken off (the latter was recently valued at $2 billion and has Oprah and Natalie Portman as investment backers). The plant-based ingredient has expanded into yogurt (like So Delicious) and ice cream (like Planet Oat) variations, among other products, and it continues to grow as the traditional dairy industry struggles to retain market share.

In part, Covid-19 has brought personal health to the forefront of everyone’s minds, so it makes sense that consumers are caring more about product sustainability and sourcing. Oatmilk is the most environmentally-friendly of the milk varieties, and uses just 1/8 of the water needed to produce almondmilk at the industrial level. Chloe’s Pops has released three flavors of their oatmilk pops and wants to bring more out, and we’re all for it. With a lot of uncertainty these days about what the future holds for the food and beverage industry in general, from supply chain disruptions to drastic changes in consumer behavior, oatmilk has make one thing clear: it’s likley here to stay.

Stepping Up and Paying it Forward

Partake Foods has launched their Black Futures in Food and Beverage Program, which will give students from five participating HBCUs the opportunity to explore the food and beverage industry. Running for seven weeks, fellows will be included in workshops and panels with CPG leaders, ending in a capstone project that will put them in the running for internship opportunities with leading brands. Said Partake Founder and CEO Denise Woodard:

“Black and brown people are underrepresented in the CPG workforce, and we feel it is both our opportunity and responsibility to help open doors for Black students interested in exploring CPG career paths.”

Woodard attributes Partake's recent success in part due to an increased effort from consumers to support Black-owned brands. “All of that extra love that has come our way because of this," she told Fortune. "We’re trying to pay it forward and support the Black community even more.”


Investments & Acquisitions

  • Unilever will acquire Liquid I.V., a health and wellness brand founded in 2012 that offers drink mixes with apparently 2-3 times the hydration of water.
  • Bayer AG will buy a majority stake in vitamin and supplement startup Care/of, giving the company a valuation of $225 million, reports Elana Lyn Gross in Forbes. It will acquire 70% of the company and will have the option to buy the rest in 2022.
  • Quinn Foods announced a $3M Series D, and will look to expand their retail and eCommerce footprint and product innovation.
  • Data science company Climax Foods raised a $7.5M seed round to innovate new ways to transform plants into affordable animal-product alternatives.
  • Wish, a booming eCommerce company, announced Monday that it will raise money through an IPO, but it has not yet disclosed how many shares will be offered.
  • Plant-based brand Laird Superfood filed for an IPO of $40 million, a move that could make it possible for the company to greatly expand product development and its retail reach.

Bright Future for Dark Stores

Whole Foods is opening its first ‘dark’ store in Brooklyn, a location that will have no on-site retail but will instead be used solely to fulfill online delivery orders, reports Kelly Tyko for USA Today. The NYC-based location is their first permanent online-only fulfillment "store," although six others were temporarily converted to dark stores during the peak of Covid-19 to optimize the spike in online orders and simultaneous decline in physical shoppers. A number of other chains, including Kroger and Bed Bath and Beyond, also made the temporary transition in the face of the pandemic.

Although dark stores have existed since before the virus pushed so many stores to introduce them suddenly, they are expected to become a new normal as consumer habits shift to favor online shopping, a trend that will likely outlast the pandemic


The Plant-Based Takeover

Eat Just, a plant-based egg brand, will see a 41% increase in retail distribution by the end of September, bringing its products to 17,000 doors nationwide, including Walmart, Kroger, and Safeway. Sales have risen since the pandemic, as well as sales for the plant-based egg category in general (of which Eat Just owns 99%). Other plant-based brands like Impossible Foods have also expanded their retail footprint in the past few months, as animal-product alternatives continue to outpace their meat- and dairy-based counterparts.  

TikTok and Teespring Team Up

Social media app TikTok announced this week that it has partnered with Teespring to allow content creators to sell merchandise on the app. This marks an important step in the platform’s social commerce adoption journey, which is in its infancy compared to the likes of Facebook but is expected to become a multibillion-dollar stream based on the success its Chinese counterpart has already had.

While its newness presents some challenges for brands (less accurate/mature tracking metrics, e.g.) this partnership is a sign that TikTok is ready to scale its commercial reach. Initially, users will not make in-app purchases; instead being directed to Teespring’s own website. But for now, the focus is just on “ways of increasing monetization opportunities for creators,” said Teespring CEO Chris Lamontagne. As that progresses it’s likely that the app will continue to add new features and capabilities, and is on track to become an eCommerce giant.


Chobani Goes Gen-Z

Chobani has launched a multi-stream campaign to kick off the release of its new Chobani Complete line, a series of high protein yogurt products that are marketed to young consumers with active lifestyles. As part of its marketing mix, Choban will run ads on Spotify during several health and wellness podcasts, and will sponsor the platform’s almost 3 million follower cardio playlist during the last week of September. The promotion also includes an interactive Instagram Story concept, which allows users to solve a puzzle that highlights the line’s key ingredients.

Chobani's innovative social commerce-driven campaign is positioned perfectly to reach their target audience: Gen Z’ers who are looking for healthy, portable snacks and tend to be some of the most active social media users.

They are not the first brand to capitalize on this marketing avenue, as food chains Chipotle and Jack in the Box have both tapped into the world of interactive social media to reach younger audiences. 


Small(er) Brands Get the Upper Hand

Small brands are seeing big growth through the pandemic as large food manufacturers are struggling to retain the customers they gained when Covid-19 first hit months ago, reports Christopher Doering for Food Dive. CPG titans like Nestlé and Kraft-Heinz have struggled to keep up with demand for many of their shelf-stable items back in March and April—a struggle which ultimately drove consumers into the welcome arms of smaller brands that were stocked on shelves and ready to meet demand.

Many of these brands jumped on the opportunity and reached out to retailers to offer a much-needed stable supply of product, which earned them more shelf-space during a time when shoppers were eager to buy, and has had a lasting impact on their sales trajectories. Alpha Foods, maker of frozen products, was one such company and has surpassed big names like Kellogg’s and Morningstar to become the brand with the best-selling plant-based nugget, and the second largest plant-based burrito brand. CAULIPOWER has gone full steam ahead as well, releasing new products and entering retail locations across the country since the pandemic began, and reaching new heights during a time that started out as a time of uncertainty and fear for many brands.


Updating a Classic Cookie

Keebler, a household name and classic cookie brand that’s been around for 167 years, has taken on the delicate task of modernizing their approach while holding onto the core elements that current customers know and love. It’s a fine balance to remain familiar enough to existing customers while creating something that will win over new ones, and Natalie Hagstrom, the GM of Cookies at Keebler's parent, is ready for the challenge.

"When you talk to the consumer [and they tell you] that your brand is nostalgic, but it's not necessarily modern, that's an opportunity to talk to them in a new way," she says. “Our cookies were always doing very well by consideration, just that we knew there was an opportunity if we wanted to increase" consumer purchases of our products.

Keebler has apparently tapped into the recent demand for authentic taste and quality by using better ingredients like Madagascar vanilla and real chocolate, a switch that would be difficult to argue with. Along with a rejuvenated package design, it seems like their strategies are working.

"When we normalize for COVID, we absolutely are seeing an impact of our products that have just started to flow through on shelves," says Hagstrom. "So far, all of the signs are very positive and pointing that we are heading in the right direction."

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Oatmilk Everything and the Pursuit of the Gen-Z Consumer: CPG News, Week of Aug 31-Sept 4

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As summer winds down and autumn quickly approaches, the CPG world continues to up its game week after week. Stay in the loop with the week’s rundown of the need-to-know news that matters now.

All Eyes on Oatmilk

Frozen novelty brand Chloe’s Pops is bringing oatmilk to dessert—and it’s a hit. The brand, which began as a fruit pops line back in 2017, says this move has been years in the making. Initially experimenting with coconut milk as a possible non-dairy base, they settled on oatmilk because of its neutrality and what founder Chloe Epstein describes as “a clean overall taste that works well with other flavors.” 

And the decision comes with some momentum behind it: Since first gaining popularity a few years ago, oatmilk has quickly become a consumer favorite.

This year alone has had some shining moments for the oatmilk market, as Nielsen reports 289% YOY growth from March to June.

Meanwhile, oatmilk-centric brands like Oatsome and Oatly have taken off (the latter was recently valued at $2 billion and has Oprah and Natalie Portman as investment backers). The plant-based ingredient has expanded into yogurt (like So Delicious) and ice cream (like Planet Oat) variations, among other products, and it continues to grow as the traditional dairy industry struggles to retain market share.

In part, Covid-19 has brought personal health to the forefront of everyone’s minds, so it makes sense that consumers are caring more about product sustainability and sourcing. Oatmilk is the most environmentally-friendly of the milk varieties, and uses just 1/8 of the water needed to produce almondmilk at the industrial level. Chloe’s Pops has released three flavors of their oatmilk pops and wants to bring more out, and we’re all for it. With a lot of uncertainty these days about what the future holds for the food and beverage industry in general, from supply chain disruptions to drastic changes in consumer behavior, oatmilk has make one thing clear: it’s likley here to stay.

Stepping Up and Paying it Forward

Partake Foods has launched their Black Futures in Food and Beverage Program, which will give students from five participating HBCUs the opportunity to explore the food and beverage industry. Running for seven weeks, fellows will be included in workshops and panels with CPG leaders, ending in a capstone project that will put them in the running for internship opportunities with leading brands. Said Partake Founder and CEO Denise Woodard:

“Black and brown people are underrepresented in the CPG workforce, and we feel it is both our opportunity and responsibility to help open doors for Black students interested in exploring CPG career paths.”

Woodard attributes Partake's recent success in part due to an increased effort from consumers to support Black-owned brands. “All of that extra love that has come our way because of this," she told Fortune. "We’re trying to pay it forward and support the Black community even more.”


Investments & Acquisitions

  • Unilever will acquire Liquid I.V., a health and wellness brand founded in 2012 that offers drink mixes with apparently 2-3 times the hydration of water.
  • Bayer AG will buy a majority stake in vitamin and supplement startup Care/of, giving the company a valuation of $225 million, reports Elana Lyn Gross in Forbes. It will acquire 70% of the company and will have the option to buy the rest in 2022.
  • Quinn Foods announced a $3M Series D, and will look to expand their retail and eCommerce footprint and product innovation.
  • Data science company Climax Foods raised a $7.5M seed round to innovate new ways to transform plants into affordable animal-product alternatives.
  • Wish, a booming eCommerce company, announced Monday that it will raise money through an IPO, but it has not yet disclosed how many shares will be offered.
  • Plant-based brand Laird Superfood filed for an IPO of $40 million, a move that could make it possible for the company to greatly expand product development and its retail reach.

Bright Future for Dark Stores

Whole Foods is opening its first ‘dark’ store in Brooklyn, a location that will have no on-site retail but will instead be used solely to fulfill online delivery orders, reports Kelly Tyko for USA Today. The NYC-based location is their first permanent online-only fulfillment "store," although six others were temporarily converted to dark stores during the peak of Covid-19 to optimize the spike in online orders and simultaneous decline in physical shoppers. A number of other chains, including Kroger and Bed Bath and Beyond, also made the temporary transition in the face of the pandemic.

Although dark stores have existed since before the virus pushed so many stores to introduce them suddenly, they are expected to become a new normal as consumer habits shift to favor online shopping, a trend that will likely outlast the pandemic


The Plant-Based Takeover

Eat Just, a plant-based egg brand, will see a 41% increase in retail distribution by the end of September, bringing its products to 17,000 doors nationwide, including Walmart, Kroger, and Safeway. Sales have risen since the pandemic, as well as sales for the plant-based egg category in general (of which Eat Just owns 99%). Other plant-based brands like Impossible Foods have also expanded their retail footprint in the past few months, as animal-product alternatives continue to outpace their meat- and dairy-based counterparts.  

TikTok and Teespring Team Up

Social media app TikTok announced this week that it has partnered with Teespring to allow content creators to sell merchandise on the app. This marks an important step in the platform’s social commerce adoption journey, which is in its infancy compared to the likes of Facebook but is expected to become a multibillion-dollar stream based on the success its Chinese counterpart has already had.

While its newness presents some challenges for brands (less accurate/mature tracking metrics, e.g.) this partnership is a sign that TikTok is ready to scale its commercial reach. Initially, users will not make in-app purchases; instead being directed to Teespring’s own website. But for now, the focus is just on “ways of increasing monetization opportunities for creators,” said Teespring CEO Chris Lamontagne. As that progresses it’s likely that the app will continue to add new features and capabilities, and is on track to become an eCommerce giant.


Chobani Goes Gen-Z

Chobani has launched a multi-stream campaign to kick off the release of its new Chobani Complete line, a series of high protein yogurt products that are marketed to young consumers with active lifestyles. As part of its marketing mix, Choban will run ads on Spotify during several health and wellness podcasts, and will sponsor the platform’s almost 3 million follower cardio playlist during the last week of September. The promotion also includes an interactive Instagram Story concept, which allows users to solve a puzzle that highlights the line’s key ingredients.

Chobani's innovative social commerce-driven campaign is positioned perfectly to reach their target audience: Gen Z’ers who are looking for healthy, portable snacks and tend to be some of the most active social media users.

They are not the first brand to capitalize on this marketing avenue, as food chains Chipotle and Jack in the Box have both tapped into the world of interactive social media to reach younger audiences. 


Small(er) Brands Get the Upper Hand

Small brands are seeing big growth through the pandemic as large food manufacturers are struggling to retain the customers they gained when Covid-19 first hit months ago, reports Christopher Doering for Food Dive. CPG titans like Nestlé and Kraft-Heinz have struggled to keep up with demand for many of their shelf-stable items back in March and April—a struggle which ultimately drove consumers into the welcome arms of smaller brands that were stocked on shelves and ready to meet demand.

Many of these brands jumped on the opportunity and reached out to retailers to offer a much-needed stable supply of product, which earned them more shelf-space during a time when shoppers were eager to buy, and has had a lasting impact on their sales trajectories. Alpha Foods, maker of frozen products, was one such company and has surpassed big names like Kellogg’s and Morningstar to become the brand with the best-selling plant-based nugget, and the second largest plant-based burrito brand. CAULIPOWER has gone full steam ahead as well, releasing new products and entering retail locations across the country since the pandemic began, and reaching new heights during a time that started out as a time of uncertainty and fear for many brands.


Updating a Classic Cookie

Keebler, a household name and classic cookie brand that’s been around for 167 years, has taken on the delicate task of modernizing their approach while holding onto the core elements that current customers know and love. It’s a fine balance to remain familiar enough to existing customers while creating something that will win over new ones, and Natalie Hagstrom, the GM of Cookies at Keebler's parent, is ready for the challenge.

"When you talk to the consumer [and they tell you] that your brand is nostalgic, but it's not necessarily modern, that's an opportunity to talk to them in a new way," she says. “Our cookies were always doing very well by consideration, just that we knew there was an opportunity if we wanted to increase" consumer purchases of our products.

Keebler has apparently tapped into the recent demand for authentic taste and quality by using better ingredients like Madagascar vanilla and real chocolate, a switch that would be difficult to argue with. Along with a rejuvenated package design, it seems like their strategies are working.

"When we normalize for COVID, we absolutely are seeing an impact of our products that have just started to flow through on shelves," says Hagstrom. "So far, all of the signs are very positive and pointing that we are heading in the right direction."

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