Insights from the New Brand Builders, Part 1
During the past five years or so, large CPG companies (more than $5.5 billion in annual sales) have lost about $15 billion in sales to smaller CPG companies (less than $1 billion in annual sales). In fact, just 10% of the top 100 CPG brands were able to maintain or grow market share during roughly that same timeframe.
Many larger brands have managed to hold on to revenue by increasing prices to make up for declines in volume. This may work in the short-term, but it’s a risky long-term strategy. Also, consumers expect a brand’s identity to align with their personal identity. They want the brands they buy to reflect their personal values. Fair or not, larger companies are not getting credit in this area.
Given these changing market and consumer dynamics, it’s important to dig deeper into what it truly means to be a brand builder in today’s retail environment. How are smaller brands disrupting the market? How are unconventional advertising and promotion driving growth? What can big brands do to think small and act fast to regain their competitive advantage?
Numerator has identified three of the fastest-growing CPG brands – Chilly Cow (healthy ice cream), Love Beauty and Planet (hair and skin care), and Bubly (sparkling water) – that are prime examples of modern brand building. All come from established CPG brands – Wells, Unilever, and PepsiCo.
The insights we’ve uncovered through Numerator Insights purchase and path data will paint a picture of disruption that’s probably different than what you expected, but also attainable for both small and large brands.
In Part 1 of our Brand Builders series, we’ll focus on Chilly Cow, the second fastest-growing ice cream brand of 2018, behind only Blue Bunny, another Wells brand.
Meet Chilly Cow
In 2018, the ice cream category grew by 2.5% and $281 million -- and Chilly Cow was responsible for 22% of that growth. Launched in March of 2018, Chilly Cow’s innovation and uniqueness lies with the use of ultra-filtered milk to drive protein up and sugar down.
Purchase frequency and buy rate for Chilly Cow have been significantly higher than the category average. Strong sales in the food and mass channels have already catapulted Chilly Cow into the top five healthy ice cream brands.
“Save Yourself from Yourself”
Chilly Cow uses the tagline, “Save yourself from yourself.” A recurring scenario in Chilly Cow videos shows people who want to indulge after a stressful day, or reward themselves after a great day. At the same time, they don’t want the guilt that comes with eating a pint of ice cream that’s loaded with fat and sugar.
Enter Chilly Cow. Instead of eating full pints you only half like, you can indulge in great-tasting ice cream without the guilt. According to Numerator Insights data, this brand promise aligns with the health and wellness attitudes of Chilly Cow buyers, who are more likely to watch their diet, read nutrition labels, watch their weight, and exercise than the average shopper.
Chilly Cow’s Brand-Building Promotional Strategy
With just a sliver of share of voice in the healthy ice cream category, Chilly Cow used coupons to attract deal seekers. Again, this strategy is consistent with the shopping behaviors of Chilly Cow customers, who are more likely than the average shopper to try new things, clip coupons, and switch brands if the deal is right.
Wells has been able to use promotions to attract an audience to Chilly Cow while preserving the brand equity of its sister brand, Blue Bunny. About twice as many consumers said mobile rebate apps and special sales influenced their decision to purchase Chilly Cow compared to Blue Bunny.
Wells has also created a unique persona for Chilly Cow. A Numerator Survey shows that the vast majority of shoppers agree or completely agree that both brands taste good – 90.7% for Chilly Cow and 95.1% for Blue Bunny. However, 60.3% say Chilly Cow is a healthy brand, compared to 22.3% for Blue Bunny.
The brand-building strategy has been a winner. Chilly Cow sales peaked soon after market entry during the spring and summer months. Sales then melted a bit and leveled off during the fall and winter, although Chilly Cow is still outperforming ice cream brands as a whole.
Stay tuned for Part 2, where we’ll take a look at Love Beauty and Planet, the vegan hair and skincare line from Unilever), and learn how they’ve targeted key demographics (and not just Millennials) with purpose-drive marketing.