Brandless is the latest brand

Mar 28, 2018 | Emerging business models | 0 comments

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In a loud and noisy world of brands screaming in your face in an attempt to dictate your lives, a new trend of ‘non-branding’ has risen and is gaining traction. One of the front runners, called Brandless has built an innovative approach to selling unbranded grocery items at low prices.

Although marketed as “unbranded”, Brandless is still a brand, it even has a trademark on its logo! Furthermore, the company brand values are stated clearly on the website – “Better everything for everyone”. The usual suspects in terms of vegan, gluten-free, organic and non-GMO are offered prominently to tempt the hippest shopper.

In an interesting evolution of the typical value chain, cofounder and CEO Tina Sharkey’s is “unapologetically redefining what it means to be a brand”.  Every item costs US$3 and the labels simply describe what’s inside. Consistent pricing is an important point of difference alongside the unbranded but stylishly presented items Brandless offers.

Brandless offers a range of food and grocery items. Consumers can buy bundles of products from the website for “hearty family breakfasts” with a single click, while trial bundles offer the most popular items for easy trial. It’s a ballsy business strategy that should strike fear into competitors due to the universal low price point that is sure to help penetrate markets. Brandless membership even eliminates shipping costs and helps build a sense of community for online shoppers.

The issues that come with this proposition may lie in maintaining the price and the quality of the products. Products are offered in portions that accommodate the US$3 price point, and that could lose the interest of consumers who want to buy larger quantities. On the other hand, it gives Brandless the ability easily to switch between competitive suppliers to manage costs.

What does this mean for branding? By eliminating “brand noise” Brandless resists the temptation that many marketers feel to develop a narrative that often doesn’t resonate with consumers. Instead Brandless showcases the creativity of its customers and how they use the products on its Instagram feed, inviting deeper engagement.

The Brandless approach removes the “paradox of choice” that consumers may find overwhelming, and according to the company, eliminates the “Brand Tax” which allows them to offer high quality products at a much lower price.  While the “Brand Tax” is typically high on personal care products, margins on staple commodities are typically lower in conventional retail settings. Presumably Brandless is able to cross-subsidise across its range, another tactic to keep prices uniform and low.

It’s at once a simple and sophisticated approach to engaging consumers and encouraging loyalty.

All in all, the introduction of ‘Brandless’ into the market has huge implications for traditional value chain models. As this unbranded trend appears to be gaining quite a large following, it begs the question to whether it is sustainable or whether it’ll be another trend consumers take on to be different, and then abandon when it is no longer so.