One Brand's Three Keys to Success In Product Development

0:00This week on the Nosh Podcast, we take a look at a not safe for work marketing campaign campaign Orchard Valley Harvest. We also discussed Ajo Delhaize's recent divestment of Fresh Direct, and we speak with the co-founder of Brazi Bites about her strategy for innovation and marketing.

0:27Hi, everyone. I'm Carol Lortenberg. On the NOSH podcast, we go inside the business of natural, organic, sustainable, and healthy food. Joining me today is reporter Brad Avery. Hello. Brad, it's just you and me today. They trusted us to be alone. Just the two of us. I'm not going to sing that song. No, we've been abandoned is what's really going on here. I'm going to take it as trust, Brad. Trust. I got to start by saying congratulations, Brad. You're getting married this weekend. Are you excited? Are you nervous? Like what's going on? What's running through your mind? Yes, it's mostly just stress about logistics, really.

1:07Finishing up everything, trying to get everything done in time. But yeah, if you're listening on the day this comes out, then I'll be getting married on Sunday. If you're listening any time after that, I'm already married. Okay, since it's the Nosh podcast, any one dish they're serving at the wedding that you're particularly excited to taste? Oh, I mean, it's very apt. I mean, the menu is all vegetarian. So it's actually very Nosh on brand. We got some butternut squash stuffed shells with like a sage cream sauce. That sounds good. And then there's a butternut squash hash cake. This is like very fall.

1:52I'm jiving with this menu. It's all very on brand for Nosh, I feel too, now that I think about it. It is. You join the podcast, Brad, and suddenly your wedding is just super on brand. I'm sure you planned it that way. Look at what you've done to me. This is your influence. Now that we've heard your wedding menu, first item to discuss today, have you seen Orchard Valley Harvest No Nut November marketing campaign? It's got a pretty, I don't know if provocative is the right word, video, and then you can get some refunds if you purchase Orchard Valley Harvest Nuts. But the video itself caught my attention.

2:32We covered it in the newsletter last week, but it made my jaw drop a little bit. It's, for those who don't know, it's how do you describe this in a way that is appropriate for a business environment is the real challenge that we've been tasked with to discuss this ad campaign. You're right, Brad. It's a little hard to describe. The way I think I summed it up in the newsletter was that the brand is encouraging people to not engage in abstinence when it comes to snacking on nuts this November. Yeah, but I feel like the context is no nut November, which is a sort of, I guess it started as an internet meme type of thing, like over a decade ago at this point.

3:20Reddit trend? If you go on Know Your Meme, you can look it up. Yeah, Reddit. We'll let people find it themselves. How about that? Yeah, it involves chastity. There we go. It involves chastity for the month of November for generally young men. So this ad campaign that they've launched now around this internet meme, let's call it, or challenge, as some people actually apparently participate in it, is framed around the idea of this ongoing campaign they've had playing with the term nuts and they back in june they released a new mascot named ovi who's just sort of it looks like their logo initials yeah but he's a little guy but he uh and if you watch the ads he's kind of got like a mickey mouse voice and but he's just sort of his head is an o and his arms are a v and his legs are an age.

4:18And so he doesn't have a face or a mouth. And so he just longs to eat nuts, but he cannot. And so he tries to urge other people to eat nuts, even when they maybe shouldn't be eating them. Like there's one that's just a guy with his mouth wired shut. And he's like, do it. Just do it. Ovi's quite a character. And I spoke to the marketing team. Apparently, he is not supposed to really understand that there might be an alternative meaning for a lot of the things he's telling people. I think he knows exactly what he's saying. When I watch these videos, I think Ovi, he knows. He's an instigator. He's sinister.

4:57He's like a little devil on your shoulder trying to tell you to eat nuts. They did say that they're not going to put this ad everywhere. The two examples they gave me were Reddit and Grindr. Oh, yeah, that makes perfect sense for that. Well, it's all over Instagram too. So, okay. Maybe it did so well that they, uh, they felt they could expand the reach. So, so actually thinking about it, it's one of those things that's like, is this actually a risky campaign or does it just have the appearance of being risky? Because I think when we think about, you know, Gen Z and millennial humor, when we think about internet age, marketing, and trying to be provocative, there's a degree to which this, in certain circles, this is actually pretty normalized.

5:48It's almost in some ways doesn't raise an eyebrow, except that a brand is doing it, which is sort of what the original play back in like early 2010s when Wendy's and Denny's were having raunchy tweets. It's sort of built out of that. And then plus you also just have the fact that sex and advertising have been hand in hand forever. ever. So this is just a different version of that. If you watch the, the, the ad, they, it's, it's completely, there's nothing wrong being depicted. There's nothing. Yeah. There's nothing overtly racy said. And they did say they're trying to appeal to a Gen Z and millennial audience.

6:32So they're not going after boomers with this. They know exactly what they're doing. I don't know how far the reach is, but clearly within the target demo, this is, you know, the type of thing that, I don't know if I want to say street cred, but certainly gets you the attention from the people you want, which are Reddit users who still post Wojak memes in 2023. They really committed to embracing online culture. There's sometimes, you know, I think we see it a lot with April Fool's where people say, oh, I want to capitalize on this meme, but I don't want to turn anyone off. So I'm kind of going to do a PC version of it.

7:17And this was going all in on. Can't pull your punches. No. So we always hear about authenticity. This definitely hits that for that generation. I will say also, if the higher ups at Orchard Valley Harvest are listening, half of the comments on the YouTube page are that your marketing team needs a raise. So let that stick in your mind as we hit the holiday season. Yeah, there we go. Yeah. And you know what? I'll just the last thing, then we should move on. But I was just thinking, you know, because I said you can't pull your punches, but you got to be careful to like clearly there is a line. I feel like someone is going to step over that line at some point because they are trying too hard to go for this.

8:04So you got to really be smart about it. They're being smart about it. You know, someone did step over the line, right? We had Kraft with their Send Nudes campaign, spent a lot of money on that. But they had to issue an apology and pull the ad off the air, stop the campaign. A lot of that comes down to who they were talking to, right? Right. Moms didn't like Kraft mac and cheese saying send nudes. Who's your brand? What is your brand and who's your audience? What's your brand stand for? It's like if Coca-Cola started trying to brand like liquid death, it doesn't work. People would just be like, okay, it's Coca-Cola.

8:42This is the send the, give the world a Coke company. You can't just do that. And so I think with Kraft, yeah, you got to consider the brand image. as well. All right, we're going to move on, Brad. Today, it was announced that Fresh Direct was acquired by Getter. For those of you who haven't heard of Getter, it is a quick service delivery company, started in Europe, has expanded into some other markets. And by acquiring Fresh Direct, they're making some serious moves on the US market. They purchased the company from Ahold who had just bought Fresh Direct in 2021. And I'm curious to see what they do with it going forward.

9:31It's curious to me what Ahold's, you know, thinking is here and, you know, why they no longer wanted Fresh Direct. They obviously still have Peapod, which is, you know, online delivery through their grocery stores. You know, and Fresh Direct is pretty big business, 3 ,200 employees, you know, particularly throughout the New York tri-state area. So this does give Getter, which I know has been trying to break into at least the Northeast. I'm not sure where else in the country they are, but I know around Boston locally, they've, you know, launched. And so it gives them definitely a strong fleet to, you know, pick up immediately as they're really trying to grow their business and, you know, enter this kind of competitive home delivery market.

10:14I think there's also a question of what Ahold divesting this company says about their long-term strategy around delivery and sort of the post-pandemic market e-commerce element. Post-Instacart IPO too. And the last thought is, I don't know the fundamentals of either of these businesses, but I do know that on average, a lot of these companies have had issues trying to make this model really work. So that's just something to consider as a challenge for the future and how under new ownership, Fresh Direct is going to keep growing and evolving. Are they going to double down in their current market or are they going to look to expand?

10:59Brad, while we stay tuned to hear more about what the future is of these two companies, we're going to hear from another quick service delivery partner, GoPuff at Nosh Live. and we're going to learn about what types of brands do well on the platform, how you can be prepared to join GoPuff and how that might fit into your channel strategy. So stay tuned. Hopefully we'll see you at Nosh Live for that conversation or tune in online. I'm looking forward to it. I will be there as well at the event. It's November 30th and December 1st. And beautiful Marina Del Rey. Yeah. First time in Marina del Rey.

11:43Excited to see that. I've never been there. So I'm looking forward to that. Carol, who do we got coming up for the interview? I spoke with Junia Rocha from Brazi Bites. I don't know if you've had their Brazilian cheese bread. I tried them at like a trade show. Yeah. Well, after so many people fell in love with their cheese bread, they decided to expand into other categories. At first, that was a breakfast sandwich. They've since discoed that product, but wanted to stay in breakfast. So they looked at social media, saw the Will It waffle trend, and decided that's the place to go. Let's launch some Brazilian cheese bread inspired waffles.

12:25There's one savory, two sweets. And I spoke with Junia about how she utilized social media and customer feedback when developing these new products, but also how she balanced that with thinking about the retail strategy, as well as manufacturing capabilities to make sure it wasn't just a cool idea. It was also something that they could execute on. Fantastic. Junia, thank you so much for being here today. Thank you so much for having me. We're going to go straight to breakfast. You just launched a new line of waffles, And I'll admit, when I first heard Brazilian cheese bread waffles, I remember I emailed you and I was like, is this for real?

13:10Like, are you really launching waffles? Why make the jump from cheese bread to waffles? So we just launched a line of gluten-free frozen waffles under the Brazi Rice brand. And it was inspired by a consumer behavior that we saw out in social. That was the beginning of it. out, you know, the line is not a cheese bread line, but it was the inspiration. We started seeing consumers waffling our cheese bread. And I know you're familiar with this trend out in social, the woolly waffle trend. You know, it gets millions of views. And we started seeing consumers putting our cheese bread into waffle iron.

13:50And that content was going viral, you know, millions of hundreds of comments and thousands. And, and we started seeing that not only on TikTok, but just like in Facebook groups and in, you know, emails and people were like, okay, there's a behavior here. Let's look at the category. And so that prompted us to look into the waffle category and to kind of realize, can we execute? Is there a place? Is there a reason for, for, for Brazzy Bites to get in there? Is there a gap that the consumers need? And so we ended up creating a line of gluten-free waffles that one of the flavor is the cheesy waffle.

14:30And it's inspired by this behavior of the waffling of the cheese bread. And to go along with it, we have two more traditional flavors. One is the home style, one is the blueberry to like round up the line. How did you know the Brazi brand could extend into waffles? So, you know, we launched, when we launched the Brazi Bites brand over a decade ago, the initial objective was to bring Brazilian cheese bread to the U.S. market. I grew up eating the cheese bread in Brazil. I saw the opportunity over the last decade created the category here. But the brand grew, right? And it became more than just the cheese bread.

15:08We had a huge following. We have a huge following. And then we started looking at where could expand? What do our consumers want? What makes people shop our products and kind of establish a core set of values. You know, our brand is truly about wowing the consumers with taste, being better for you and naturally gluten free. But it's about this delightful taste, you know, experience. That's what we do best. And so we, you know, we're more than cheese bread now. We've expanded in other day parts, in other categories, we continue to be rooted in frozen. But you know, the consumers wanted more from us.

15:47And so that's why we wanted to go into the breakfast category. You knew from consumers there was this opportunity to do more and be more. And then you saw this trend on TikTok. How did you go about implementing this strategy? And what did it take to go from TikTok to store shelves? Yeah, so that initial behavior of the consumer was the first spark of the idea. And it prompted us to look at it and dig more. In the case of the waffle, we then see this behavior, right? And it was big enough to look at it. So there was one particular piece of content that got over a million views. So it did go viral, viral in the truest form.

16:34And when something goes viral related to your brand, you're going to look at it. So then we started looking at other data points. What's going on in the waffle category? That was the next thing, right? Let's look at the category. Is there a reason to be? Is there a gap? And when we were looking at the category, we learned, you know, some data that the buyers are very used to, like the frozen waffle is growing. Global waffle sales are growing at about 5 % rate. Better for you sales are growing at about 8%. So that's driving the category growth. In the better for you space, gluten-free is very important and it's growing significantly as well.

17:13um gluten intolerance continues to play a part in in our our brand and our success that is um you know something that continues to be predominant and then we looked at what we do best which is well on the taste category and we felt like the gluten-free waffles in the market were lacking um in taste and we could deliver on that so we kind of designed a waffle that could meet like three key criterias that the consumers are looking for taste gluten-free and protein the second step after that because now we're still talking about okay consumer behavior now we did market research and now we're going to test with a retailer because one thing that's really important for us and we've learned lessons along the year the years if you don't have the right retailer to launch a product, then, you know, it's, that's a critical point, right, to get to get to success there.

18:09And so we put in front of a key account that we felt like would be a good launch partner. And immediately they clicked with a format, they said, how fast can you deliver it, we want it, we love this, to the point that they, you know, forced our kind of, you know, our, our process to bring it to market. And they sped the process because they were so excited. And we actually, quite frankly, did not expect that, you know, because it's such a saturated category. It's competitive, high household penetration. We're like, is there really a need? But then when that buyer tells us on a key account with significant distribution in the country, like, how fast can I get it?

18:48I want this. That gave us confidence to then go build the operations to bring the product to markets. Let's break that down a little further, starting with the consumer behavior. You mentioned, you know, a video going viral. Sometimes things that go viral are very fleeting. How did you know that this was something that had staying power versus, you know, just a trend that a year from now, instead of Willett's waffle, it's going to be Willett grilled cheese? I don't know, something else? Will it blend? It was years ago, right? That's why I think it's important to do all of that other research and not just like, hold on to that trend and think that that's the end all and be all right.

19:31It's it's all those different things like, is this a trend? Or is there a need? What else can we do around that? In addition to the wheelie waffle trend, we started seeing you know consumers just changing putting that cheese bread in that format outside of the really waffle trend so like in other platforms such as Facebook groups where you get a kind of an older customer base and and they were like also doing that it's like this tastes great this way I want to make that form and so that's why I think it's important that you just you you qualify in multiple different ways. Like there's, there's a trend.

20:13Does that behavior have staying power? What is happening in that category? Is there a retailer that is giving me a signal directional that there is a need in the set, right? Because for an innovation to be successful, all of those things have to work out. It's like you have those, those key components. And if something is broken in there, then it doesn't take off. How do you know if it's broken or it just hasn't happened yet? Like you can, there are a lot of people who invent and come up with new products that are totally whimsical or very inspiring or exciting, but you're maybe not seeing consumers ask for it because they don't know that it could exist.

20:57That's such an interesting thing you're saying, because when I started Brazi Bites a decade ago, that's exactly what my life was. Like for a decade, I knew I had something really tasty, but people didn't know I existed, right? And one of the things that guided me as like a leader in this company is this principle of just obsessing about being discovered. And you show up to work every day and you have like so many things to do and you can, how many priorities are on your plate and where are you going to win? I think, you know, once you dig in, like you can have a great product and you can get shelf space, but if it doesn't get discovered in time for you to drive the velocity that you need, then it's going to fall off the shelf the next year.

21:45Our industry is very impatient, right? That's the reality of the ecosystem that we live today. The retailers have their own P &Ls to meet. The velocities, you need to get to certain velocities, you have a certain time, some are more patient than others, some are going to, you know, kind of hold your hand a little bit more, but it's like at its core, it's impatient, and it's fast moving. And so being laser focused on driving that trial is really important. Right. And so and I think like digging in, like each brand, there's a, there's always a reason instead of digging in and trying to understand the why it's not working, right?

22:24If you create that sort of whimsical product. Okay, maybe you're getting really good feedback from a select number of consumers and they're giving you a signal, but is there enough there to scale? Is there enough there to sustain? Maybe the answer is yes, you just gotta go communicate to them and go find them. Maybe the answer is it's a really loud minority and it's not gonna scale. And so like digging into the why something is not getting traction yet, is there a path forward or is there something just kind of broken in there that perhaps need to be totally revisited? It's funny because I see a lot of brands that are really buzzy on Instagram or TikTok.

23:10You might see them in the New York Times or Bon Appetit, but it's hard sometimes to figure out how much of that buzz is going to translate to sales on shelf. I think at the end of the day, like what wins is like the consumer purchasing of your products in whatever capacity that suits your brand at that moment in time. And so making sure that you're driving trial and, you know, where the consumer is shopping at, because you might be getting a lot of PR, you might be getting a lot of buzz, you might be even going viral on social media. But is that really leading to purchase? At the end of the day, you've got to move products.

23:50You've got to drive revenue. You've got to create a viable business for you. And at least if it's not there yet, is there a path forward with the tools that you have on hand? There's a lot of wacky trends out there. You know, every day and like social is fast moving. You know, every day there's something. But there's a lot that sticks. There's still a lot of discovery. and those viral pieces of content, you know, putting in front of a million people, that's meaningful, right? That's sort of your old numbers from TV. That's a lot of exposure. And so if you do have a really great product that's resonating at the right time and people can get access to it at a price point that is appealing to them, then you can start driving that traction and driving that trial then leads to traction, leads to repeat.

24:41And so that's what we're all trying to do every day. And how do you determine that key retailer? Does that mean that retailer who's willing to hold your hand? Or are there times when it's something else you're looking for? Oh, that's a juicy question. I mean, because a lot of brands, right, think it's that retailer that's going to be patient and really guide them. But sometimes you want the retailer that can blow you out into a ton of stores all at once. So I will tell you what drives Browsy Bytes today, but I also tell the listeners how to potentially look at it. And it will change from the size and depends on your objective, right?

25:22I think this is also largely driven by your operations. So let's just say you're launching a new product and you sign on with a command that's amazing, but it's highly automated and it has high expectations for volume that you got to achieve on year one. So that's going to influence your go-to-market strategy and who that key partner is. So that plays a part here for us, right? Can I drive enough volume? When it came to the waffles for us, there was a couple of things. Can I work with a retailer that is a great executor, that is a true partner? So what does that mean, a great executor, right? In our industry, you have this network of retailers, and you sometimes sell a product.

26:08You're at the trade show. You're at the speed dating events, and you get a buyer call, and you sell the product. Then you ship to the distributor. Then they say the reset is a certain date, and then you wait. Then they say, give me 30 days for that reset. Then you start visiting stores. You send your broker. You do your programs. And then you say, okay, the shelf compliance is at 50%. Then you spend all of your energy chasing your tail. My product's not even there. The price is wrong. Okay, so let's go back to what I care today when I was launching Waffles. It's a retailer that can execute, a retailer that will say what, they will do what they're saying they're gonna do.

26:49So if the reset is a certain date, what is the shelf compliance? I wanna spend our energy, our resources driving trial, not making sure that it's shelf compliant. As you launched the waffles, you also made a deliberate choice to pull back on another product line and discontinue that. Tell us a little bit about that process and product. So you're referring to a breakfast sandwich that we launched a couple years ago that we are phasing out to then launch waffles, right? As waffle launch, we're phasing that line out. And so that is a line where we first got into breakfast with that line and kind of started to understand that category.

27:33And that was very beneficial. But that was a line that ultimately did not work for us. And largely because of manufacturing issues and supply chain issues and cost of goods. So to kind of break that down a little bit, what do I mean by that, you know, if you think about like just sandwiches in general, that's a highly manual assembly. And so we came in starting that very small with the hopes that that would scale. But ultimately, you know, with inflation, and that's a very egg heavy product, it became very expensive to do. We didn't have the right back end to scale with the right cost structure.

28:16And again, the right retail partner to just really scale this to the point where we could maybe tackle some of those issues, it didn't materialize. And so with the opportunity of Waffle coming to us via, you know, the consumer insight and the retailer partnership, we felt like that was a much stronger line for us to pivot to and learn the lessons that we learned going into the frozen breakfast category. So I understand what you're saying that there were lessons learned. But I remember when you launched the sandwiches, you were pretty confident that this fit a need in the marketplace. There was white space for the sandwich.