3 things restaurant brands better learn from Brandless. Fast.

There’s been a ton of coverage of Amazon over the past few months. First, they bought Wholefoods. Then they announced a meal delivery service almost immediately. While all that was going on, a few articles appeared about a company called Brandless. If you haven’t yet heard about it, the company is founded on several important beliefs which you need to understand if you want to compete today.

1. Everything they sell at Brandless is $3.

It’s simple because customers hate complexity. Everything – everything – on their site today is available for $3. There’s nothing to think about. Handsoap? $3. Coffee K-cups? $3. Mustard? $3.

2. Brandless turned lack of grocery distribution from a weakness into a strength.

This is classic disruption. Knowing that it’s next to impossible to get broad product lines into grocery chains, they instead focused on direct distribution. This not only allows them direct access to their customers – they don’t have to trust grocery staffers to help sell the product or protect the experience – they also realized they didn’t have to account for the retailer mark-up. Hence Point 1.

3. Brandless rendered lack of brand awareness meaningless.

By choosing the name Brandless along with a generic look and feel they’ve risen above the marketing fray. They’ve said we can’t compete against hundred year old brands on their terms, so we’ll fight by diminishing the importance of ‘brands.’

This is a coup. Brandless appeals to younger consumers that are less loyal, especially to legacy brands. It makes of its products certified organic, gluten free, non-GMO, vegan, no added sugar and certified kosher to make sure it is all inclusive. To be fair, this is a well executed gimmick, albeit a clever one. Look for a company like Amazon to purchase Brandless in the next 18 months.

OK. So how does this relate to the restaurant business?

Reduce barriers to purchase.

They are starting with products that reduce barriers to consumption. By making products that cut out sugar, GMO and non-vegan ingredients, they’re making it easier to buy them. They built it this way from scratch, intentionally. Today’s younger consumers don’t start with a baseline expectation that things don’t fit their requirements. They demand products that meet their needs. Especially food. Make it hard to meet their dietary needs and they’re not coming back.

Don’t make consumers think about prices.

Second, they made pricing super simple. In the grocery store, people hate the way stores force them to compare prices. Especially since young consumers are more likely to shop at multiple stores to achieve their regular grocery shopping. Pricing in restaurants it’s not much different. They want it to be obvious that the price is fair for what they’re getting. Can you make everything on your menu $3? Probably not. But could you stand to streamline pricing? Definitely. Make it easy to understand.

Control the experience.

How many times will you read that the experience is all-important to consumers? For most brands, one time too few. Brandless controls every part of the experience. Consumers buy and receive products directly from them. This is an advantage over brands that are at the mercy of retailers to present the brand correctly, or next to a competitor that makes them look favorable. People choose everything from taxis, to musicians and now toilet paper based on the experience. What are you doing to improve the one you offer?

Brandless is currently selling CPG space and coming after established brands. It probably has nothing to do with your business if you are in the restaurant space. One thing we have learned from the digital disruption of the past 15 years is that a successful business model is replicated in every other sector. Soon, someone will launch an unbranded restaurant concept that reduces barriers, offers simple pricing and a controlled, positive experience. Today, you have a chance to pre-empt the success of that concept. Tomorrow? Who knows.

Interview With Gluten-Free Flour Brand, Blends by Orly

gluten free, flour, cpg, grocery, brand
Orly Gottesman has figured out how to sell a niche product to an audience in need

At Food & Restaurant Marketing, we are obsessed with understanding the type of insights that allow brands to break through a crowded category like the gluten-free industry. This 3.2 billion dollar industry (Statista 2016) demands brands to take unique approaches to positioning their products. With almost 30% of all adults in the U.S. trying to avoid gluten, we wanted to talk with someone who is intimately involved with the industry to discover insights about this ever-growing audience and what drives them to consider gluten-free products.

Blends by Orly

Orly Gottesman, a Le Cordon Bleu graduate, discovered her passion for baking while at culinary school. During that same time, Orly’s husband Josh discovered he had celiac disease. Josh, who grew up in the baking and restaurant business, thought his life was over. He’d never be able to enjoy a bagel again. Orly saw an opportunity to focus her studies on gluten-free and worked with the head chef of the baking program to conduct an independent study around gluten-free baking.

From there, Orly set out to create the highest quality gluten-free flour blends for those that love baking. Blends by Orly launched in August 2014 and since that time, Orly has been navigating her brand through a rapidly growing industry.

I recently sat down with Orly over Skype to learn more about her business and customers.

AB: What have you learned about your current audience that made you take a different look at how you thought about your brand?

OG: First, we learned that this is a very female-focused product. For a demo, we would bake a whole bunch of product, mostly cookies. Women would love them and say, “oh wow that’s a really great idea to make cookies with this blend.” Men would come over and say, “where can I buy these?” Then we’d tell them that actually the product is the flour and you actually have to bake them. They’d look at me and say, “oh, I don’t bake.” Even a man who had three children with celiac walked up to me, loved the cookies and said, “not for me.”

I find that I’m wasting my time talking to men. Even the buyers at supermarkets, the female buyers always get it more than the male buyers, unless they are a chef.

The other key element I’ve found is that the blends don’t sell as well in cities or densely populated areas like Manhattan. Kitchens are tiny and people generally won’t bake if they feel like they don’t have enough space in their kitchen. We sell much better in suburban areas. People that do a lot of cooking and entertaining are really our sweet spot in terms of a target audience. Also, it’s a higher priced product, so it’s a given that we are seeing higher income customers interested in our product.

AB: How large is the gluten-free business and how many people suffer from celiac disease?

OG: 1% of the total population suffer from celiac disease. Many of my customers actually don’t have celiac disease. They do, though, find themselves sensitive to gluten or have other autoimmune diseases. Gluten can cause inflammation, so many people get off gluten to support an anti-inflammatory diet. The good thing about my blends is that they provide options for dietary restrictions like a sugar-free, gluten-free diet.

AB: Any opportunities or feedback from your customers on new products?

OG: I have recently launched a kosher baking mix for Challah in three different flavors: traditional, chocolate chip, and poppyseed & onion. That was very specific and the opportunity was clear in terms of bringing a new product to the market that doesn’t exist.

I’m also thinking a lot about distributing a pre-baked gluten free bread product. Blends are great for a very specific audience. If I’m going to expand, I think it’ll have to be with ready-made products. I don’t want to come out with just another cake mix.

AB: How are you attracting the audience that is considering a gluten-free diet?

OG: We are beginning to send nutritionists promotional material. Nutritionists are the first ones a doctor sends them to if they need to alter their diet. For example, I was diagnosed with hypoglycemia and I learned I was eating too much sugar and gluten. These nutritionists will recommend easing up on the gluten. They aren’t going to recommend trying a gluten- free brownie mix. They’re going to recommend finding a wholesome gluten-free flour like one of my blends. Some of the specialty markets we are in will have nutritionists on site, so we talk to them and let them know about our product. We’re starting to consider the right time to put together a plan for marketing.

AB: What was your initial strategy for distribution and how has that changed over time?

OG: Starting out it was “the chicken or the egg” scenario. We started out doing all the distribution ourselves. Obviously, you’re not going to find a distributor to take you on initially if you don’t have accounts, and then a lot of stores don’t want to take you unless you have a distributor. Our initial strategy was to just pound the pavement and go to stores that would allow us to distribute directly to them. It was truly door to door sales and cold calling.

Once we had enough stores with our product, we then decided to go to the distributors and show them what we accomplished and why we are a great product that people need. We got a distributor on board with us and focused only on New York and New Jersey. We took this same model of starting out by self-distributing in Chicago and then moved to a local distributor there as well as on the West Coast. But it’s a very long process.

AB: What’s the biggest challenge you are facing right now with distribution?

OG: We realized we really need brokers. We were a little late in the game here, but we’re learning fast that the brokers are the ones who get your product moving off the shelves and keep the orders coming.

If you’re interested in learning more about Blends by Orly, please check out her website where you can learn more about her gluten-free flour blends and order product: http://blendsbyorly.com/